Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@. Skimlinks & other affiliated links are turned on

Search
  • FIRST POST
    • hiohaa
    • By hiohaa 11th May 18, 7:31 PM
    • 29Posts
    • 1Thanks
    hiohaa
    Excellent credit score, likelihood, earnings...yet can't get a loan
    • #1
    • 11th May 18, 7:31 PM
    Excellent credit score, likelihood, earnings...yet can't get a loan 11th May 18 at 7:31 PM
    My net income is £2636 a month. I have savings of £4k.
    My monthly outgoings are £1200 including rent at £600.
    I was employed from 2009-2012 earning 30k.
    Then employed from 2014-2016 earning 45k.
    Went back to uni, did a masters. Been at my new job 6 months, earning 49k.

    I have no debts. No dependents, no loans. No nothing. I've been using a santander credit card since 2014 which i always paid off in full every month via direct debit without fail. Never been in debt since i graduated back in 2009.
    At the moment there's a balance of 3k on it out of 7k, because i bought a decent tv last month.

    My credit history is flawless, my credit score via experian report + the moneysavingexpert club thing all checked out - scores of 970, loan eligibility all 90%+ for 3% loans. All the soft searches came back good.

    I've just tried applying for loans today, for £24,500, for a car purchase.
    Most of them came back with unable to provide the loan. The best rate i got was from the post office at 7.9%.

    I just don't understand it. What do you have to do to be eligible for a 3% loan these days??
Page 1
    • Pixie5740
    • By Pixie5740 11th May 18, 7:52 PM
    • 12,444 Posts
    • 17,689 Thanks
    Pixie5740
    • #2
    • 11th May 18, 7:52 PM
    • #2
    • 11th May 18, 7:52 PM
    My net income is £2636 a month. I have savings of £4k.
    My monthly outgoings are £1200 including rent at £600.
    I was employed from 2009-2012 earning 30k.
    Then employed from 2014-2016 earning 45k.
    Went back to uni, did a masters. Been at my new job 6 months, earning 49k.

    I have no debts. No dependents, no loans. No nothing. I've been using a santander credit card since 2014 which i always paid off in full every month via direct debit without fail. Never been in debt since i graduated back in 2009.
    At the moment there's a balance of 3k on it out of 7k, because i bought a decent tv last month.

    My credit history is flawless, my credit score via experian report + the moneysavingexpert club thing all checked out - scores of 970, loan eligibility all 90%+ for 3% loans. All the soft searches came back good.

    I've just tried applying for loans today, for £24,500, for a car purchase.
    Most of them came back with unable to provide the loan. The best rate i got was from the post office at 7.9%.

    I just don't understand it. What do you have to do to be eligible for a 3% loan these days??
    Originally posted by hiohaa
    https://www.moneysavingexpert.com/loans/credit-rating-credit-score

    It could be anything, affordability, length of time in your current job. Have you checked all 3 credit (Equifax and Call Credit in addition to Equifax) files to view your history?

    How many applications have you made so far? More the two and you will look like a desperado to lenders.
    • Pixie5740
    • By Pixie5740 11th May 18, 7:55 PM
    • 12,444 Posts
    • 17,689 Thanks
    Pixie5740
    • #3
    • 11th May 18, 7:55 PM
    • #3
    • 11th May 18, 7:55 PM
    If you're hellbent on borrow that much to buy a car have you considered finance from the dealership as that often comes with incentives?
    • zx81
    • By zx81 11th May 18, 7:58 PM
    • 17,791 Posts
    • 18,905 Thanks
    zx81
    • #4
    • 11th May 18, 7:58 PM
    • #4
    • 11th May 18, 7:58 PM
    Affordability looks to be the main issue.
    • hiohaa
    • By hiohaa 11th May 18, 7:59 PM
    • 29 Posts
    • 1 Thanks
    hiohaa
    • #5
    • 11th May 18, 7:59 PM
    • #5
    • 11th May 18, 7:59 PM
    https://www.moneysavingexpert.com/loans/credit-rating-credit-score

    It could be anything, affordability, length of time in your current job. Have you checked all 3 credit (Equifax and Call Credit in addition to Equifax) files to view your history?

    How many applications have you made so far? More the two and you will look like a desperado to lenders.
    Originally posted by Pixie5740
    well i did the experian thing and the moneysavingexpert thing also...
    didn't try the other 2.

    Well as for Applying to more than 2 lenders - I did some research into this and i don't think its accurate - the systems are clever enough to distinguish between someone shopping around for a loan rate, or whether they are seeking funds because they are in trouble.
    If i've been firing away say 6 applications in last 3 hours, it shouldn't affect the rating.

    I will find the source for that info, read it somewhere in an article....

    on the flip side many articles also say this:
    "If you make several applications for credit in a short period of time, this may have an even greater impact on your credit score. This is because having several hard searches carried out in quick succession may appear to anyone looking at your credit report that you!!!8217;re desperate for credit, or that you!!!8217;re suddenly struggling with your current debt."

    which i don't get, because how else are you supposed to shop around for the best quote?
    Last edited by hiohaa; 11-05-2018 at 8:02 PM.
    • hiohaa
    • By hiohaa 11th May 18, 8:03 PM
    • 29 Posts
    • 1 Thanks
    hiohaa
    • #6
    • 11th May 18, 8:03 PM
    • #6
    • 11th May 18, 8:03 PM
    https://www.moneysavingexpert.com/loans/credit-rating-credit-score

    It could be anything, affordability, length of time in your current job. Have you checked all 3 credit (Equifax and Call Credit in addition to Equifax) files to view your history?

    How many applications have you made so far? More the two and you will look like a desperado to lenders.
    Originally posted by Pixie5740

    here we go - found the article on this:
    https://www.creditkarma.com/advice/i/will-rate-shopping-hurt-my-score/

    So will rate shopping hurt my credit score?
    Yes and no. You probably know that each time you apply for a new line of credit you’re normally hit with a hard inquiry. Hard inquiries can negatively affect your score, so moving from lender to lender and piling up a bunch of these in a small period of time is probably not a great idea.

    Still, depending on what type of credit you’re shopping around for and what model you’re getting your score from, the extent of the damage can vary. If you’re looking for an auto loan or mortgage specifically, some credit score models will allow for some level of shopping around by essentially viewing multiple inquiries within a certain time period as just one. Bureaus usually identify the fact that you’re comparison shopping by noticing the types of credit lines you’re applying for and the size of your requested loan, so it may be best to stay consistent. The time period over which you can rate shop under these models without feeling the effect of multiple inquiries can vary and is often from around 14 days to up to 45.

    Beware that a single inquiry could still have a somewhat negative effect on your credit. Also keep in in mind that this rate shopping adjustment is only adopted by some credit score models and usually only applies to auto loans and mortgages. So if you’re applying for a dozen credit cards over a month or two, you’re likely to still incur a bunch of hard inquiries.
    • hiohaa
    • By hiohaa 11th May 18, 8:05 PM
    • 29 Posts
    • 1 Thanks
    hiohaa
    • #7
    • 11th May 18, 8:05 PM
    • #7
    • 11th May 18, 8:05 PM
    oh well - if i can't get a decent rate i can't get it - simple as that. I'll just have to do it the traditional way, and save up for 2 years.
    • John-K
    • By John-K 11th May 18, 8:05 PM
    • 654 Posts
    • 1,016 Thanks
    John-K
    • #8
    • 11th May 18, 8:05 PM
    • #8
    • 11th May 18, 8:05 PM
    You are asking to borrow half a hear!!!8217;s Gross salary (not net) only a few months into a new job. This does not sound like a brilliant idea from the perspective of the lender.
    • zx81
    • By zx81 11th May 18, 8:06 PM
    • 17,791 Posts
    • 18,905 Thanks
    zx81
    • #9
    • 11th May 18, 8:06 PM
    • #9
    • 11th May 18, 8:06 PM
    That looks like an American article.

    Lenders in the UK do tend to be cautious around multiple applications for most types of credit.
    • Pixie5740
    • By Pixie5740 11th May 18, 8:06 PM
    • 12,444 Posts
    • 17,689 Thanks
    Pixie5740
    That looks and sounds like a website based in the US of A talking about credit reference agencies in the US of A, not the UK.
    • hiohaa
    • By hiohaa 11th May 18, 8:08 PM
    • 29 Posts
    • 1 Thanks
    hiohaa
    You are asking to borrow half a hear!!!8217;s Gross salary (not net) only a few months into a new job. This does not sound like a brilliant idea from the perspective of the lender.
    Originally posted by John-K
    so you reckon the algorithms can see that then, and go 'he's been earning this much for 6 months only, bit dodgy'?
    • Pixie5740
    • By Pixie5740 11th May 18, 8:12 PM
    • 12,444 Posts
    • 17,689 Thanks
    Pixie5740
    On the application it usually asks for length of time in employment. In your case that's less than 2 years so you're still in your probationary period (assuming outside of Scotland) and can be dismissed with ease.
    • hiohaa
    • By hiohaa 11th May 18, 9:27 PM
    • 29 Posts
    • 1 Thanks
    hiohaa
    On the application it usually asks for length of time in employment. In your case that's less than 2 years so you're still in your probationary period (assuming outside of Scotland) and can be dismissed with ease.
    Originally posted by Pixie5740
    interesting
    well in my case the probation period was 6 months which ended in April...
    maybe the computers still think i'm ... in it? no idea.
    • nic_c
    • By nic_c 11th May 18, 9:57 PM
    • 1,555 Posts
    • 858 Thanks
    nic_c
    interesting
    well in my case the probation period was 6 months which ended in April...
    maybe the computers still think i'm ... in it? no idea.
    Originally posted by hiohaa
    .
    different things Your company may say you have an initial probation period but UK employment law treats people differently after they have been with a company for 2 years, so whilst you may be out of your companies initial probation its a lot easier to get rid of you until you have been with a company for 2 years.

    Also consider you were recently on a lot less income (yes by choice to boost your career) have very little credit history and suddenly after getting a larger income want a large loan.

    Also you haven't been rejected but assume that you should get the top rate of 3% because of a nice credit score, the CRA's don't lend money.
    • John-K
    • By John-K 11th May 18, 10:11 PM
    • 654 Posts
    • 1,016 Thanks
    John-K
    so you reckon the algorithms can see that then, and go 'he's been earning this much for 6 months only, bit dodgy'?
    Originally posted by hiohaa
    Yes. New job, big fraction of your gross wage, this is not really at the complex end of data mining.

    People are much more likely to lose their job in the first year or two, both because it is legally easy and because that is when people turn out to be a bad fit.

    Edited to add, what do you think is dodgy? Your company can currently let you go on a whim, you have pretty much no security. If they dislike your face, the way you chew, or your choice of shirts they can sack you and you have no route to recompense.
    Last edited by John-K; 11-05-2018 at 10:16 PM.
    • hiohaa
    • By hiohaa 12th May 18, 2:07 PM
    • 29 Posts
    • 1 Thanks
    hiohaa
    well. Tesco bank just called. I got the 3% loan for £24500.
    brilliant!
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

543Posts Today

5,769Users online

Martin's Twitter