Loan Anxiety

MarcMCFC1986

Hello

My car died on me on Thursday, and is a write off. I have found a really good second hand car, and agreed a deal with the seller, so went home and I applied for a £4,000 loan with Tesco Bank. I did a search on one of the comparison websites and it said 95% likelihood being approved by Tesco, so was expecting it to be approved immediately - however it has been referred and I need to wait 2-3 days for a decision. My credit report is really good, having only missed one payment in the last 7 years - however, this was only 2 months ago (forgot to set up a Direct Debit for my Credit Card and missed a £5 payment - it is up to date now though). I have a mortgage on my house with about £40k of equity, and a relatively good income (just over £2k a month after tax).

I've become really anxious about this and I'm worried the loan is going to be rejected and I won't have any way of getting a new car. I have since gone back and done another search on the comparison site and my likelihood of being accepted by Tesco Bank is 0%! Is this because I've already submitted an application?

Also, I used the switch guarantee service to change bank account from Lloyds Bank to Santander, and this literally completed Saturday morning - and I submitted my loan application Saturday afternoon. Is this likely to have affected it?

Obviously I wouldn't have switched banks had I known my car was going to die, so just hoping that something as simple as switching banks won't prevent me getting a loan.

I'm taking some comfort in the fact that the loan application wasn't an immediate decline, but does anybody know whether most applications that are a referral generally are approved eventually? 

Sorry - long post but wanted to get all the information down, and hope somebody can tell me something the relieve my anxiety and help me get a decent nights sleep. I'll probably get a decision in the next 24-48 hours, but I'm just really worried about it at the moment. 

cheekykid

MarcMCFC1986 said:

Hello

My car died on me on Thursday, and is a write off. I have found a really good second hand car, and agreed a deal with the seller, so went home and I applied for a £4,000 loan with Tesco Bank. I did a search on one of the comparison websites and it said 95% likelihood being approved by Tesco, so was expecting it to be approved immediately - however it has been referred and I need to wait 2-3 days for a decision. My credit report is really good, having only missed one payment in the last 7 years - however, this was only 2 months ago (forgot to set up a Direct Debit for my Credit Card and missed a £5 payment - it is up to date now though). I have a mortgage on my house with about £40k of equity, and a relatively good income (just over £2k a month after tax).

I've become really anxious about this and I'm worried the loan is going to be rejected and I won't have any way of getting a new car. I have since gone back and done another search on the comparison site and my likelihood of being accepted by Tesco Bank is 0%! Is this because I've already submitted an application?

Also, I used the switch guarantee service to change bank account from Lloyds Bank to Santander, and this literally completed Saturday morning - and I submitted my loan application Saturday afternoon. Is this likely to have affected it?

Obviously I wouldn't have switched banks had I known my car was going to die, so just hoping that something as simple as switching banks won't prevent me getting a loan.

I'm taking some comfort in the fact that the loan application wasn't an immediate decline, but does anybody know whether most applications that are a referral generally are approved eventually? 

Sorry - long post but wanted to get all the information down, and hope somebody can tell me something the relieve my anxiety and help me get a decent nights sleep. I'll probably get a decision in the next 24-48 hours, but I'm just really worried about it at the moment. 

Yes you get 0% now because you've applied for it however do bear in mind that eligibility checkers aren't always that representative. I was recently pre-approved for a virgin card, applied and got rejected.

Can't you get a 0% interest credit card for 4k? and once the 0% is up switch to another company? I am not sure a loan makes sense for 4k. Its a bummer for the missed payment but if they take a manual look they should be able to tell that you missed the payment due to honest negligence not affordability. Perhaps is worth letting them know about it.

MarcMCFC1986

cheekykid said:

MarcMCFC1986 said:

Hello

My car died on me on Thursday, and is a write off. I have found a really good second hand car, and agreed a deal with the seller, so went home and I applied for a £4,000 loan with Tesco Bank. I did a search on one of the comparison websites and it said 95% likelihood being approved by Tesco, so was expecting it to be approved immediately - however it has been referred and I need to wait 2-3 days for a decision. My credit report is really good, having only missed one payment in the last 7 years - however, this was only 2 months ago (forgot to set up a Direct Debit for my Credit Card and missed a £5 payment - it is up to date now though). I have a mortgage on my house with about £40k of equity, and a relatively good income (just over £2k a month after tax).

I've become really anxious about this and I'm worried the loan is going to be rejected and I won't have any way of getting a new car. I have since gone back and done another search on the comparison site and my likelihood of being accepted by Tesco Bank is 0%! Is this because I've already submitted an application?

Also, I used the switch guarantee service to change bank account from Lloyds Bank to Santander, and this literally completed Saturday morning - and I submitted my loan application Saturday afternoon. Is this likely to have affected it?

Obviously I wouldn't have switched banks had I known my car was going to die, so just hoping that something as simple as switching banks won't prevent me getting a loan.

I'm taking some comfort in the fact that the loan application wasn't an immediate decline, but does anybody know whether most applications that are a referral generally are approved eventually? 

Sorry - long post but wanted to get all the information down, and hope somebody can tell me something the relieve my anxiety and help me get a decent nights sleep. I'll probably get a decision in the next 24-48 hours, but I'm just really worried about it at the moment. 

Yes you get 0% now because you've applied for it however do bear in mind that eligibility checkers always aren't that representative. I was recently pre-approved for a virgin card, applied and got rejected.

Can't you get a 0% interest credit card for 4k? and once the 0% is up switch to another? I am not sure a loan makes sense for 4k. Its a bummer for the missed payment but if they take a manual look they should be able to tell that you missed the payment due to honest negligence not affordability. Perhaps is worth letting them know about it.

Thanks - I expected it had gone to 0% because I’d already applied with Tesco, as all the others were still at 95% likelihood.

I did think about a credit card, but the car purchase is a private sale so the guy wants cash. To be fair though, the interest isn’t bad on the Tesco loan - it’s a 2 and a half year loan (30 months), and you only pay £400ish interest. £148 a month repayments. 

Yes I think I’ll call Tesco today and explain the missed credit card payment so whoever assesses the loan application can see it was a small amount and a genuine mistake. Then I guess I’ll just cross my fingers!

ItsComingRome

MarcMCFC1986 said:

cheekykid said:

MarcMCFC1986 said:

Hello

My car died on me on Thursday, and is a write off. I have found a really good second hand car, and agreed a deal with the seller, so went home and I applied for a £4,000 loan with Tesco Bank. I did a search on one of the comparison websites and it said 95% likelihood being approved by Tesco, so was expecting it to be approved immediately - however it has been referred and I need to wait 2-3 days for a decision. My credit report is really good, having only missed one payment in the last 7 years - however, this was only 2 months ago (forgot to set up a Direct Debit for my Credit Card and missed a £5 payment - it is up to date now though). I have a mortgage on my house with about £40k of equity, and a relatively good income (just over £2k a month after tax).

I've become really anxious about this and I'm worried the loan is going to be rejected and I won't have any way of getting a new car. I have since gone back and done another search on the comparison site and my likelihood of being accepted by Tesco Bank is 0%! Is this because I've already submitted an application?

Also, I used the switch guarantee service to change bank account from Lloyds Bank to Santander, and this literally completed Saturday morning - and I submitted my loan application Saturday afternoon. Is this likely to have affected it?

Obviously I wouldn't have switched banks had I known my car was going to die, so just hoping that something as simple as switching banks won't prevent me getting a loan.

I'm taking some comfort in the fact that the loan application wasn't an immediate decline, but does anybody know whether most applications that are a referral generally are approved eventually? 

Sorry - long post but wanted to get all the information down, and hope somebody can tell me something the relieve my anxiety and help me get a decent nights sleep. I'll probably get a decision in the next 24-48 hours, but I'm just really worried about it at the moment. 

Yes you get 0% now because you've applied for it however do bear in mind that eligibility checkers always aren't that representative. I was recently pre-approved for a virgin card, applied and got rejected.

Can't you get a 0% interest credit card for 4k? and once the 0% is up switch to another? I am not sure a loan makes sense for 4k. Its a bummer for the missed payment but if they take a manual look they should be able to tell that you missed the payment due to honest negligence not affordability. Perhaps is worth letting them know about it.

Thanks - I expected it had gone to 0% because I’d already applied with Tesco, as all the others were still at 95% likelihood.

I did think about a credit card, but the car purchase is a private sale so the guy wants cash. To be fair though, the interest isn’t bad on the Tesco loan - it’s a 2 and a half year loan (30 months), and you only pay £400ish interest. £148 a month repayments. 

Yes I think I’ll call Tesco today and explain the missed credit card payment so whoever assesses the loan application can see it was a small amount and a genuine mistake. Then I guess I’ll just cross my fingers!

I wouldn't bother. They're not interested.

If this was a mortgage application they might be willing to take your comments on board but not for a loan.  To be honest I'm surprised you weren't rejected outright.

bazzyb

MarcMCFC1986 said:

 I'm worried the loan is going to be rejected 

You may not be accepted.  If the eligibility checker is correct then you have a 95% chance, which means five people in every hundred applicants will be declined.  There is no need to worry about it, you will get a decision in due course.

MarcMCFC1986 said:

 I won't have any way of getting a new car.

There are other loan providers available and other ways of purchasing cars.

Brie

Frankly I would not be paying cash for a car - particularly if sold privately.  There's been a number of posts on MSE about people having things go wrong with cars 2 days after purchase and how big a pain it is to deal with.  Maybe it works if you are a mechanic and know exactly how roadworthy the car is.  Also what's the come back if the vehicle is stolen or had been written off?

Much easier if you've used a card.  

DrEskimo

Brie said:

Frankly I would not be paying cash for a car - particularly if sold privately.  There's been a number of posts on MSE about people having things go wrong with cars 2 days after purchase and how big a pain it is to deal with.  Maybe it works if you are a mechanic and know exactly how roadworthy the car is.  Also what's the come back if the vehicle is stolen or had been written off?

Much easier if you've used a card.  

How would a private car purchase be done on a credit card?

MarcMCFC1986

ItsComingRome said:

I wouldn't bother. They're not interested.

If this was a mortgage application they might be willing to take your comments on board but not for a loan.  To be honest I'm surprised you weren't rejected outright.

Ok cheers - that makes me feel much better! 

Borders2017

Can you not lease a car? You can get good lease deals for around £100 and then if something goes wrong with the car you are not in line to pay and fix it.
With an income of 2k+ a month you really should be saving each month to build up a buffer of a few months income for events like this.
Maybe have a look at your spending and see if you can cut back and save more.

MarcMCFC1986

Borders2017 said:

Can you not lease a car? You can get good lease deals for around £100 and then if something goes wrong with the car you are not in line to pay and fix it.
With an income of 2k+ a month you really should be saving each month to build up a buffer of a few months income for events like this.
Maybe have a look at your spending and see if you can cut back and save more.

Hello Borders - thanks for your reply.

I had a look at a lease for a car, but they weren't big enough for me - or all the things we'll need with a baby on the way (yes, I've factored this in to the affordability of getting a loan). Our budget is £150 a month, and anything in the size we need is about £220+ (we have no deposit to put down as my current car is worthless).

I do put £400 a month into savings, but this is all to cover my fiances maternity leave at the moment as her employers maternity package isn't very generous - so spending all the savings we have on a car would leave us short in about 9 months time.

This has just come at a very inconvenient time (is there ever a convenient time for a car to be written off?)

tlc678910

Hi,
If you have no luck with the loan some credit cards allow you to balance transfer cash into your bank account https://www.moneysavingexpert.com/credit-cards/money-transfers/. This is on similar terms to a balance transfer i.e. low rate or 0% for a fixed period/fee.

If you or your partner already have credit cards it might be worth checking if you already have offers available to you.

Another option could be to get a 0% on spending card  https://www.moneysavingexpert.com/credit-cards/best-0-credit-cards/ (the page title suggests best offers are 23 month 0% on purchases) and use your savings to buy the car then put groceries/petrol and things you need for the baby onto the card.  If you do this it could be easy to overspend when putting everything on the card so be careful.