Unlikely to get a loan despite excellent credit and no debts

LightbulbFlashing

LightbulbFlashing said:

Deleted_User said:

Can you not just take it out of your savings? With north of £700 a month left over, you should be in a decent place.

You can then rebuild your savings with the money you're not wasting on the loan.

LightbulbFlashing said:

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Yes, but my bank said that it would likely be refused by others too. 

The only reason for your bank to say that with any confidence would be if you had a CIFAS marker or similar. 

Ok, I will double check. I have had it confirmed there is no sus activity on my account and have checked. I will call them all in the week. I can only imagine it must look odd that someone has taken out a loan and paid off quickly?

I then tried to take another one after that quickly?!

Grumpy_chap

LightbulbFlashing said:

the only incorrect info is it shows I have a £4K loan out, which I don’t - I paid it off super quickly to avoid me paying stacks of interest 

That is incorrect info, but delayed info.  

If a Lender sees that you borrowed £3k or £4k in September, but not that you paid it back already, and then sees that you are after another £8k in November, it may appear to a Lender as though you are desperate for finance.

A Lender may also see the £4k borrowed, repaid, now borrow again as an indicator of poor financial planning.

A Lender may see the £4k borrowed and then rapidly paid down as simply unattractive business (all the costs to open and close the account but no interest to recover the costs against).

You may not agree with any of the above perceptions, but the Lender's view is in the eye of the beholder.  They give some consideration as to how a Lender may be viewing your credit file as less than attractive.

If you are saving £500 - £700 monthly, are you able to borrow from yourself (savings) and then repay to the savings account?  Alternatively, do your credit cards have sufficient facility to support this £8k car?
Or another lender - e.g. Dealer finance may be less stringent than the bank?

Brie

How much credit do you have available on your credit card?  And do you have only one?  Does your wife?  

I tend to buy cars on a credit card and then transfer the balance to another card to get 0% for a year or two.  

LightbulbFlashing

Grumpy_chap said:

LightbulbFlashing said:

the only incorrect info is it shows I have a £4K loan out, which I don’t - I paid it off super quickly to avoid me paying stacks of interest 

That is incorrect info, but delayed info.  

If a Lender sees that you borrowed £3k or £4k in September, but not that you paid it back already, and then sees that you are after another £8k in November, it may appear to a Lender as though you are desperate for finance.

A Lender may also see the £4k borrowed, repaid, now borrow again as an indicator of poor financial planning.

A Lender may see the £4k borrowed and then rapidly paid down as simply unattractive business (all the costs to open and close the account but no interest to recover the costs against).

You may not agree with any of the above perceptions, but the Lender's view is in the eye of the beholder.  They give some consideration as to how a Lender may be viewing your credit file as less than attractive.

If you are saving £500 - £700 monthly, are you able to borrow from yourself (savings) and then repay to the savings account?  Alternatively, do your credit cards have sufficient facility to support this £8k car?
Or another lender - e.g. Dealer finance may be less stringent than the bank?

The issue is I paid off the money early through hard work and a bit of luck (the payout for the last car).

I have since been told to now wait until the 3rd December at least as it looks like I am credit hungry, it appears that I am looking desperate for cash and wait for the loan to be updated on my record 

LightbulbFlashing

Brie said:

How much credit do you have available on your credit card?  And do you have only one?  Does your wife?  

I tend to buy cars on a credit card and then transfer the balance to another card to get 0% for a year or two.  

I have a £9.5k and have £200 on it. So £9.3k remaining. Wouldn’t this make it even worse for me? By making me look like I am hovering up cash? My wife doesn’t have a credit card.

I find this whole system ridiculous.

people such as me denied this, when the feckless get what they want 

TheMilkmansDad

I echo what others have said but you don't appear to have acknowledged (my bad if you have!)

Why are going for the loan option - if you're saving £500-700 a month then either wait a year to purchase of use your savings? Both would be a much cheaper option in the long run.

LightbulbFlashing

TheMilkmansDad said:

I echo what others have said but you don't appear to have acknowledged (my bad if you have!)

Why are going for the loan option - if you're saving £500-700 a month then either wait a year to purchase of use your savings? Both would be a much cheaper option in the long run.

Acknowledged but then I would have to pay and fix up my wife’s car for an MOT which will cost more than it is worth 

[Deleted User]

LightbulbFlashing said:

Brie said:

How much credit do you have available on your credit card?  And do you have only one?  Does your wife?  

I tend to buy cars on a credit card and then transfer the balance to another card to get 0% for a year or two.  

I find this whole system ridiculous.

people such as me denied this, when the feckless get what they want 

It's not quite that simple.

"People such as you" are presenting either too high a risk or too poor a return.  "The feckless " may have committed fraud to get further credit or more likely, are not actually getting the lines of credit you think they are. Headline stories of unemployed people getting thousands of pounds of credit are not typically representative of reality. 

There's a few reasons why you're not seen as a great prospect, as posted above. You need to manage your expectations and place your applications accordingly. eg not at top of the table lenders.

LightbulbFlashing

Brie said:

How much credit do you have available on your credit card?  And do you have only one?  Does your wife?  

I tend to buy cars on a credit card and then transfer the balance to another card to get 0% for a year or two.  

Have you done this with a trade seller? I take it no issues?

Ebe_Scrooge

LightbulbFlashing said:

Brie said:

How much credit do you have available on your credit card?  And do you have only one?  Does your wife?  

I tend to buy cars on a credit card and then transfer the balance to another card to get 0% for a year or two.  

Have you done this with a trade seller? I take it no issues?

This one crops up pretty often.  Many/most car dealerships will not accept full payment by credit card, due to the relatively high fees they have to pay to the card issuer.  It's wise to put a deposit on card, for the S75 protection, but most dealers won't accept more than a deposit on card.

Yes, we do hear of dealers who are happy to accept full payment by card - but the general consensus is that they're in the minority.  You'd need to ask the dealership themselves.

The other fly in the ointment is that you can't bank on being able to get another card to transfer the balance to.  If you can get a 0% purchase card with a high enough limit, then great.  But if you buy on your existing card, then find you can't get a 0% card to transfer it to, you're a bit snookered.