Affordability Criteria

roter75

Hi all, Just wondered if there was a way to look at what sums have been taken into account when scoring affordability? I earn £50K pa and my partner earns £30K. 
I have no overdraft,a credit card that I pay off monthly plus two car PCP that total ££800 per month. Our mortgage is only £550 pa. Really cannot see where there is a problem? 
Any help apreciated. 

TadleyBaggie

roter75 said:

Really cannot see where there is a problem? 

You haven't said what the problem is...

roter75

So I haven't !! DOH, I am trying to apply for a travel card and apparently I am not eligible. Check my score which is high except for affordability. 

cymruchris

Have you tried the eligibility checkers directly on the card provider's own websites - or generic comparison sites? If the latter - then try the former - you may very well see a different result.

Are you on the electoral roll?

Were any of your financial commitments recent?

Do you regularly carry a balance on the credit card? (You say you pay it every month - and I think you mean in full - but worth clarifying)

Having no overdraft doesn't actually make you more 'creditworthy' - having one that you don't use does.

Sometimes it's more about having MORE credit and using it responsibly than having little to no credit as you barely use it or need it. 

Lenders like to see a pattern of use and repayment (Even if paying in full to avoid interest).

MalMonroe

Hi, has there been a problem?

You could both check your credit reports - Experian, Equifax, TransUnion - to see if there's anything on them that is incorrect or that could be affecting your affordability.

You won't be able to find out how lenders score you because the scores you are allocated by the Credit Reference Agencies are only seen by you and lenders use their own scoring processes.

As you have a joint annual income of £80k and a relatively low monthly mortgage payment with no other debts, lenders may be wondering why you have two cars on PCP when, in theory, you could pay outright for vehicles. I'm also wondering that. 

Are you both on the electoral roll and is your address correct?

Have a look at those reports and see if there's anything you can rectify on there would be my advice.

Hope that helps.

roter75

Thank you! I have an overdraft facility that isn't used. One of the PCP commitments is new. I have two actice CC and both are paid in full every month. We are both on the electoral role and I have been at the same address for over10 years. 

I might contact the banks direct but I am cautious if i get turned down then my score drops which is currently very high. 

grumbler

roter75 said:

I might contact the banks direct but I am cautious if i get turned down then my score drops which is currently very high. 

It's only a credit search that has a short-lasting effect. Whether you were rejected or accepted isn't recorded.

cymruchris

roter75 said:

I might contact the banks direct but I am cautious if i get turned down then my score drops which is currently very high. 

It's not about contacting them directly - it's completing the eligibility checkers directly on their websites - and not using compare the market style comparison sites. The former uses the data it sees on a soft search to marry up with its own scoring criteria, giving a more accurate result, the latter uses a 'best guess' scenario based on a few thousand people in similar circumstances.

If you're looking for a decent travel card - the two best options currently seem to be Clarity and Barclaycard Rewards - both offer forex fee-free exchanges on purchases overseas. The Barclaycard has the added advantage that if you need to withdraw cash, there are no fees there either - and no interest as long as you settle your statement in full.

Have you tried the eligibility checkers directly on both websites?

roter75

cymruchris said:

roter75 said:

If you're looking for a decent travel card - the two best options currently seem to be Clarity and Barclaycard Rewards - both offer forex fee-free exchanges on purchases overseas. The Barclaycard has the added advantage that if you need to withdraw cash, there are no fees there either - and no interest as long as you settle your statement in full.

Have you tried the eligibility checkers directly on both websites?

Barclaycard was the one I planned to go for. I have had Clarity in the passed and didn't have a good experience with Halifax so don't really want to give them my custom now. 

I will try the Barclaycard one. I was just concerned that given my reasonable salary and fairly low unsecured debt,  I was advised I have low affordability rating on Experian. 

cymruchris

roter75 said:

cymruchris said:

roter75 said:

If you're looking for a decent travel card - the two best options currently seem to be Clarity and Barclaycard Rewards - both offer forex fee-free exchanges on purchases overseas. The Barclaycard has the added advantage that if you need to withdraw cash, there are no fees there either - and no interest as long as you settle your statement in full.

Have you tried the eligibility checkers directly on both websites?

Barclaycard was the one I planned to go for. I have had Clarity in the passed and didn't have a good experience with Halifax so don't really want to give them my custom now. 

I will try the Barclaycard one. I was just concerned that given my reasonable salary and fairly low unsecured debt,  I was advised I have low affordability rating on Experian. 

The eligibility check on the Barclaycard website won't affect anything in your credit profile at all. It's only hard searches when you make the final application that other lenders see. So give it a try and see what it says. Then if it says no - it might be worth reviewing all of the information on each of the three main credit reference agencies to see if there's any errors in the information recorded.

born_again

roter75 said:

Thank you! I have an overdraft facility that isn't used. One of the PCP commitments is new. I have two actice CC and both are paid in full every month. We are both on the electoral role and I have been at the same address for over10 years. 

I might contact the banks direct but I am cautious if i get turned down then my score drops which is currently very high. 

Just what sort of limit do you have on these?

So if you have a limit of say £30K on these. You can see why they might decline a further card. It's not that they are cleared each month. It's the amount of protentional debt you have.

As lenders will look at your income to debt, as well as their own risk appetite on lending.