So igot a loan with 10 months to run on it. I have a credit card with very little on it. I own my house (well pay morgage) that ive never defaulted on. If i buy anything with an interest free period its payed for before the intrest kicks in.

So why cant i get a loan, the other loan only owes about £500.
I thought id be a good customer but obviously im a bad person who cant be trusted?!

How do they work out credit scores?

Are you on the electoral roll?

It’s simple

You put your details in – they check that you actually need it and then say no

If you don’t need it they say yes

prob worth paying a few quid for an experian / equifax credit scoring file if its really a mystery. Equifax in particular have an excellent online tool which tells you what things are likely to influence your rating.

A few things to consider.

How much is “very little” on your credit card and what’s your limit? If you’re using a fair chunk of your limit, it will really count against you?

How much is your mortgage? If its a lot compared to your salary it will count against you.

How much do you earn? Again if its relatively low then trying to borrow isn’t a good idea in a lender’s eyes

DO NOT pay for a credit report. You can see it for free

http://www.noddle.co.uk. Just ignore the upsells

It may be that you have too little credit history. A lot of the scorecards like to see a decent transaction history across multiple credit accounts.

It’s definitely worth checking out. I applied for a new credit card to do the balance transfer thing, and was declined for the first time ever. I have never missed a payment on any loan/cc so was confused as to why I was rejected. Turns out British Gas had reported me for not paying a £187 bill that was never sent to me and that I had repeatedly called them about. It was for a rented flat, for the first few weeks after I moved in before my provider took the bills over. I would never have found out about it had I not checked Experian. You get a 30 day free period but I will check out noddle now though.

@DavidB: Noddle is a pile of sh1t IME. I signed up a while back when they first appeared and the level of detail they have on me is BS. I’ve just checked now (out of interest) and the same old carp appears. I appreciate you might have a different experience.

Well i had the opposite, me and the wife have paid and now own our cars, we have no debts other than a mortgage and household bills, savings and both have good jobs, with perfect credit scores. went to a sofa place to get a sofa on credit and they refused us, were both on electoral roll etc and we got refused??? Asked a freind in the know and if your “too reliable” ie will pay on time or early some creditors/banks wont lend you money as they wont earn the late payment fees or big interest on you so i asked my bro who has a ccj and owes shed loads out, bingo first pop they allowed him to have sofa, also my old boss whos more than well off (owns 64 properties and 20 garages) got refused a 65k mortgage on a property he wanted, swift change of banks (they werent happy) and he got what he wanted its daft this scoring malarky just get someone else to get it for you.

its stupid eh phil – i have friends without a bean to rub together , one of them has been made bankrupt in the past.

recently bought a house – and with it they qualified for secured loans against it.

15k audi RS4 on the drive… no bother.

if i was a money lender they and for that reason would be the last people id give money too…

same as you phil. I just have a mortgage and credit card with a zero balance.
I was told to use my card, but as whatever the total is gets paid off each month in full, I tend to just use my debit card.

This might sound odd, but when I was thinking about a new car. I was told to consider finance as I could save more by not using my savings. Turns out I couldn’t get credit on a set of seat covers.

I thought id be a good customer but obviously im a bad person who cant be trusted?!

Credit score isn’t about how reliable you are, it’s about how much money they will make off you.

My Wife was turned down when she applied for one of these intrest free deals for our new sofa. The chap at the shop said they see it a lot if its the wifes applying because they generally use credit less, & so generate less history (good or bad). Sure enough, apart from a couple of phone contracts, she has had nothing on finance for a good few years. He ran it again with my details & it was fine. 😕

I think molgrips is probably right. 😕

Credit scoring is financial risk management

You are asking a company to lend you dosh

They want it back with interest so they need to understand whether you can afford it and have a track record of paying it back.

The credit score is based on one of many scorecards that adds up all of the bits of information they have about you to arrive at a number. Crudely, you get plus points for credit accounts that have a good payment history, plus points for a solid set of current accounts and minus points for late payments etc.. Some score cards also look at the links you have with others, some don’t.

This number is then used by the finance company against past history and some other maths. Simplistically, they have a score that they will accept along with other important factors (for example, must have more than one transacting account etc…). There are a range of scorecards and a range of data sets so you will never see a 100% consistent result across all products.

The more information they have about you the more honed the decision. molgrips is only correct in the point that the score is designed to make money out of you..by ensuring that you pay it back. There is shitloads of science and stats behind it, but this does mean that people can fall into the wrong end of the bell curve through no fault of their own. The madness is that the best way for them to get out of it, is to gain some credit and operate it well.

spacemonkey: the only missing information on noddle should be searches as the 3 credit reference agencies don’t share this.

Use Experian’s free trial, it’s very good and explains it in very simple terms how each element of your credit file affects your ability to gain further credit.

Can’t recommend it enough.

PS – On my file there was an address on there which I had no connection with whatsoever! So maybe there’s something on yours you don’t know about…

Everything you need to know:

http://www.moneysavingexpert.com/loans/credit-rating-credit-score

Ironically, one thing that can affect your score is not using credit. Someone who regularly uses a credit card and pays the minimum repayment every month (or indeed, pays it off in full) will have a much better rating than someone who has a card they never use. “Good payer” vs “zero,” I guess.

Just for balance. Tried Noddle for free and it’s not bad actually IMO

just for balance. Tried Noddle for free and it’s not bad actually IMO

+1 quite shocked at how much info they have on me!

Its mental i think, the people who can afford to pay back should be able lend, work hard pay into system and pay back on time should be rewarded not hinderd, but anyway its a mystery to me we got our sofas in the end ; )