Good credit rating, no loan

Jaco70

I have an excellent credit rating, which I fiercely protect. 1000 out of 1000 on ClearScore, and slightly less on my bank website.

I applied for a loan via ClearScore (12.5k over 36 months), and chose one of the lenders who were listed as ‘pre-approved’.

Anyway, I put in the details (many were already filled in, as ClearScore has them recorded), but when I got to a certain stage it came up with a message saying I didn’t meet the criteria. Same story on my bank website, when I tried the same loan from them.

It’s not the end of the world, but it would be nice if they gave more detail as to why it’s been declined.

I assume it’s because I take a small weekly salary from my business and have quite a lot of mortgage debt, but I also take dividends, and have NEVER missed any loan or mortgage payment.

I’ve taken plenty of small loans in the past, so was surprised at the outright refusal on this. Some explanation with the refusal would be helpful. 

la531983

By all means.

The score is a useless metric seen only by you and not the lender. It could go down because it's a Wednesday.

Nasqueron

Jaco70 said:

I have an excellent credit rating, which I fiercely protect. 1000 out of 1000 on ClearScore, and slightly less on my bank website.

I applied for a loan via ClearScore (12.5k over 36 months), and chose one of the lenders who were listed as ‘pre-approved’.

Anyway, I put in the details (many were already filled in, as ClearScore has them recorded), but when I got to a certain stage it came up with a message saying I didn’t meet the criteria. Same story on my bank website, when I tried the same loan from them.

It’s not the end of the world, but it would be nice if they gave more detail as to why it’s been declined.

I assume it’s because I take a small weekly salary from my business and have quite a lot of mortgage debt, but I also take dividends, and have NEVER missed any loan or mortgage payment.

I’ve taken plenty of small loans in the past, so was surprised at the outright refusal on this. Some explanation with the refusal would be helpful. 

Unfortunately your 1000 score is irrelevant as no lenders use it, they don't even see it, they run your credit history and income through their own systems and produce a yes/no based on those - that data will never be public

If you were rejected it's likely because of affordability, they won't give you much more than that to stop people gaming the system.

I would stress less about protecting the gimmick number that means nothing - if 1000/1000 was meaningful, you wouldn't be rejected for a loan would you?

Mark_d

You've got a good credit score with clearscore but what about with credit karma or experian?  Experian are the most popular credit reference agency so I check my Experian score via their app (I also check the other two).

A good credit core means that you can be trusted to make payments.  This aligns with the fact that you've never missed a loan payment.

A lender looks assess your credit worthiness [using their own credit scoring] but they also consider other things, like affordability and whether you are the sort of customer they want.  I always pay credit cards in full by direct debit each month.  Zopa turned me down for a credit card and I believe the reason is that they wouldn't make money out of me - because I don't pay interest.

Jaco70

Nasqueron said:

Jaco70 said:

I have an excellent credit rating, which I fiercely protect. 1000 out of 1000 on ClearScore, and slightly less on my bank website.

I applied for a loan via ClearScore (12.5k over 36 months), and chose one of the lenders who were listed as ‘pre-approved’.

Anyway, I put in the details (many were already filled in, as ClearScore has them recorded), but when I got to a certain stage it came up with a message saying I didn’t meet the criteria. Same story on my bank website, when I tried the same loan from them.

It’s not the end of the world, but it would be nice if they gave more detail as to why it’s been declined.

I assume it’s because I take a small weekly salary from my business and have quite a lot of mortgage debt, but I also take dividends, and have NEVER missed any loan or mortgage payment.

I’ve taken plenty of small loans in the past, so was surprised at the outright refusal on this. Some explanation with the refusal would be helpful. 

Unfortunately your 1000 score is irrelevant as no lenders use it, they don't even see it, they run your credit history and income through their own systems and produce a yes/no based on those - that data will never be public

If you were rejected it's likely because of affordability, they won't give you much more than that to stop people gaming the system.

I would stress less about protecting the gimmick number that means nothing - if 1000/1000 was meaningful, you wouldn't be rejected for a loan would you?

 

Well, this is interesting. I thought the fact that the credit reference company has links on the website  to loans, mortgages etc, meant that keeping up to date on everything would count for something. Clearly not.

I took out a small loan against an un-mortgaged property last year (just 30k), and it was ludicrously difficult. And I have loads of experience of borrowing money against property in the past, when my houses were worth less and my income was lower, and it couldn't be more different now. 

TadleyBaggie

The CRA's have no idea of actual income or savings. So if you have say £25K available credit and were making payments, but your income was £25k, the CRA would "assume" you have a sufficient income to service the debt. However when you actually make a loan application and have to state your actual income lenders will make their decision based on real income/expenditure numbers, which often result in rejection.

Desmond_Hume

Mark_d said:

You've got a good credit score with clearscore but what about with credit karma or experian?  Experian are the most popular credit reference agency so I check my Experian score via their app (I also check the other two).

A good credit core means that you can be trusted to make payments.  This aligns with the fact that you've never missed a loan payment.

A lender looks assess your credit worthiness [using their own credit scoring] but they also consider other things, like affordability and whether you are the sort of customer they want.  I always pay credit cards in full by direct debit each month.  Zopa turned me down for a credit card and I believe the reason is that they wouldn't make money out of me - because I don't pay interest.

This post is enough to give you your full daily allowance of internet nonsense. 

dumpster_fire2025

Jaco70 said:

Nasqueron said:

Jaco70 said:

I have an excellent credit rating, which I fiercely protect. 1000 out of 1000 on ClearScore, and slightly less on my bank website.

I applied for a loan via ClearScore (12.5k over 36 months), and chose one of the lenders who were listed as ‘pre-approved’.

Anyway, I put in the details (many were already filled in, as ClearScore has them recorded), but when I got to a certain stage it came up with a message saying I didn’t meet the criteria. Same story on my bank website, when I tried the same loan from them.

It’s not the end of the world, but it would be nice if they gave more detail as to why it’s been declined.

I assume it’s because I take a small weekly salary from my business and have quite a lot of mortgage debt, but I also take dividends, and have NEVER missed any loan or mortgage payment.

I’ve taken plenty of small loans in the past, so was surprised at the outright refusal on this. Some explanation with the refusal would be helpful. 

Unfortunately your 1000 score is irrelevant as no lenders use it, they don't even see it, they run your credit history and income through their own systems and produce a yes/no based on those - that data will never be public

If you were rejected it's likely because of affordability, they won't give you much more than that to stop people gaming the system.

I would stress less about protecting the gimmick number that means nothing - if 1000/1000 was meaningful, you wouldn't be rejected for a loan would you?

 

Well, this is interesting. I thought the fact that the credit reference company has links on the website  to loans, mortgages etc, meant that keeping up to date on everything would count for something. Clearly not.

I took out a small loan against an un-mortgaged property last year (just 30k), and it was ludicrously difficult. And I have loads of experience of borrowing money against property in the past, when my houses were worth less and my income was lower, and it couldn't be more different now. 

I think your income is going to be the problem here.

Low salary with a non-guaranteed income from dividends. I suspect I know why you're doing it that way but it's not going to do you any favours with algorithms unfortunately.

They don't give out reasons so as to avoid people gaming the system, and perhaps to a lesser extent to avoid getting people upset because they take things personally which causes them to complain.

...something something this is why we can't have nice things....

EnPointe

Jaco70 said:

I have an excellent credit rating, which I fiercely protect. 1000 out of 1000 on ClearScore, and slightly less on my bank website.

I applied for a loan via ClearScore (12.5k over 36 months), and chose one of the lenders who were listed as ‘pre-approved’.

Anyway, I put in the details (many were already filled in, as ClearScore has them recorded), but when I got to a certain stage it came up with a message saying I didn’t meet the criteria. Same story on my bank website, when I tried the same loan from them.

It’s not the end of the world, but it would be nice if they gave more detail as to why it’s been declined.

I assume it’s because I take a small weekly salary from my business and have quite a lot of mortgage debt, but I also take dividends, and have NEVER missed any loan or mortgage payment.

I’ve taken plenty of small loans in the past, so was surprised at the outright refusal on this. Some explanation with the refusal would be helpful. 

Affordability  based on  earnings is the immediate red flag here 

Jaco70

Thanks for the replies, I’ve learned a lot, especially in relation to the CRA being unimportant.

I’m still a little unclear as to why I was turned down if the lenders DON’T have access to these details, as I stated my actual income and my outgoings, which should have counted in my favour. 

Anyway, it wasn’t critical, and I expect my situation to improve in the next twelve months for different reasons.

Thanks again. 

MattMattMattUK

Jaco70 said:

Thanks for the replies, I’ve learned a lot, especially in relation to the CRA being unimportant.

The CRAs are important because of the data they hold, the made up ratings or scores are however totally irrlevant.

Jaco70 said:

I’m still a little unclear as to why I was turned down if the lenders DON’T have access to these details,

Potential lenders do not have access to your made up score or rating, neither do they care about them, they are marketing gimmicks created by the CRAs. Potential lenders do have access to all your existing borrowing data, utility contracts, payment records for those things, the ability to check you are on the electoral register etc.

Jaco70 said:

as I stated my actual income and my outgoings, which should have counted in my favour. 

Your "actual income" and outgoings only count in your favour if they are within the ranges, or internal risk analysis measurements of the lender. If they only lend to people earning £50k+ and you earn £49k then your actual earnings will not help. As previous posters have said non-standard incomes complicate things, some lenders do not like them, they often treat income from dividends differently to PAYE income, which the treat differently to self-employed income.

Jaco70 said:

Anyway, it wasn’t critical, and I expect my situation to improve in the next twelve months for different reasons.

Thanks again. 

Good luck with that, if you do need further information in the future there are many knowledgeable people on here who will be able to assist.