Bit of an odd one really – just bought a new (to me) car, and I wasn’t sure how best to finance it (from savings or borrow at low interest and keep cash in bank), so I applied for a loan anyway whilst I was deciding. Long story short, my application was refused due to my credit score apparently – but I have no debt, I do have a credit card but there’s nowt on it and I have a mortgage with no arrears etc. I have never defaulted on a loan or CC etc.

Is it worth me chasing the bank to make sure they don’t have duff info? I did an Experian check a few months ago out of idle curiosity and my credit score was about as good as you can get get.

Is it worth me chasing the bank to make sure they don’t have duff info?

They will just tell you to get your Experian and Equifax reports. Just get the cheap ones, no point buying the expensive ones

There could be an error on your file etc

The only other thing is that you may not have enough credit. Sounds daft but true.

Get on noddle and see for yourself, it’s free.

Frankly though, there might be a thousand different reasons, some might be bad, some might not be – I was a credit underwriter for 10 years and there’s not enough room on here to explain all the different parameter.

If your credit report is as you think it should be, consider applying elsewhere – there is no universal credit scoring system – that’s a myth sold by the credit report people.

If you need anymore info once you have your report, just ask me.

the ‘credit score’ on the experian site is of no relevance to anyone, the lender just takes the info on there regarding your payment history and makes their own credit score. I work in the industry and at a guess I would say it’s either your lack of debt causing a problem, since you have little or no debt history how do they know you’re a good risk OR you simply don’t have enough income to support the loan you’ve requested under their criteria.

My Wife was refused when we bought our new sofa.
As we had done everything in my name over the years she had no history.
Mine went straight through.

Hmm, so no debt means no loan, lots of debt means fill your boots! I can sort of see the slightly twisted logic to that, but it’s a bit off. My income, modest though it is in comparison to some, was plenty to cover the repayments on what was a relatively small loan. I might give them a call and see what the crack was.

Car’s bought now so it’s slightly irrelevant now, but I want to know if there’s any issue as we will be re-mortgaging next year!

As above, perversely, it could be your relatively non-active credit history etc that counts against you in the credit scoring. Evidence that you are actively servicing debt is a plus, bizarrely.

its possible you were looking too likely to pay it off – so they would make no money off you missing payments etc….

For anyone its worth getting your report once in a while.

I have had comnpanies make errors on the recording of completion of mobile phone agreements.

You could also have people linked to your address giving you a bad reference.

Mortgages are different entirely, if you already have a mortgage then you should have no trouble, since they’ll take your house if you don’t pay but with loans if you don’t pay they may as well whistle for it.

As backward as it seems, being in debt makes you a better prospect for a loan. If you pay for everything up front and have never had credit (like, say, my mum) then you’re a bad credit risk. Use a credit card daily, make sure your minimum payments on direct debit and never bounce, and people will be falling over themselves to give you free money.

Assuming there’s not a mistake, probably the best thing you can do to improve it would be to use the credit card for purchases (which is a good idea in any case for the protection it affords) and pay it off in full every month so you don’t start accruing interest.

I was refused a mobile phone a while back, as was my wife. It turned out that, as mentioned above, despite having a mortgage and credit cards which we use all the time – but effectively as debit cards, theuy just didn’t have enough to go on (to satisfy that particular firm’s requirements).

They recommended we go next door to another firm, and try there. We did….and the applications went through without a hitch.

FWIW my Experian score was only two or three percent off the maximum

You’re not still riding a 26 inch wheeled bike are you? That could be it. 27.5 makes your loan authorisations come alive.

and people will be falling over themselves to give you free money.

where’s this free money then. I’d like some please – a lot actually. Has to be free though, I’m not paying any of it back.

where’s this free money then. I’d like some please – a lot actually. Has to be free though, I’m not paying any of it back.

I was chatting with my wife (works in credit risk) this morning about Wonga’s business model, which she reckons must anticipate a much higher level of defaulted loans which are uneconomic to pursue to the ends of the earth. So I reckon there’s free money there to be had if you’re determined enough.

where’s this free money then.

It’s not free of course, as any phule no. Point is, that’s how some people view it, and end up getting into difficulties.

As backward as it seems, being in debt makes you a better prospect for a loan. If you pay for everything up front and have never had credit (like, say, my mum) then you’re a bad credit risk. Use a credit card daily, make sure your minimum payments on direct debit and never bounce, and people will be falling over themselves to give you free money.

I seem to remember MBNA cancelling the credit cards of thousands of customers who paid in full and on time every month as they weren’t making them any money.

I seem to remember MBNA cancelling the credit cards of thousands of customers who paid in full and on time every month as they weren’t making them any money.

Is that right? What about all the money they must have been making on merchant card fees then? I’ve been paying all my credit cards off in full every month for many years and never had a problem.

I can understand them cancelling dormant accounts and MBNA probably had their fair share of those as people shuffled from one card to the next, but not cancelling active accounts as they should be making some money off every card transaction.

As FunkyDunc said get your credit history report. I did mine through Experian only to find a Barclaycard default notice in my history dated 2 years after I had closed the account.
On advice from Experian they put a note on my file along with a copy of a letter from Barclaycard to myself stating the account had been settled in full from when I had closed the accounts.
Experian can’t remove the entry even though it was clearly wrong and I had to Barclaycard to remove it. This is where is all went pear shaped. Barclaycard wouldn’t remove it until I paid the balance. When I asked what the balance related to as I had paid the account off in full with letter from themselves to confirm so they couldn’t tell because the account was closed.
This default stayed on my account for another 5 months after that it was over 5 years old and automatically removed. I did complete a complaint form to the ICO but just got back a letter stating it would be 2 years before they could look at it due to back logs.

Check moneysavingexpert (as usual), they have a checker that does a silent credit check to tell you which providers are more likely to accept you. FWIW it was spot on when it told me that AA were going to reject me from the off whilst Sainsburys would take me on, that was for a £15000 home improvement loan. My credit record is nigh-on perfect so god knows what the AA were looking for.

My guess is that certain providers cater to different demographics, I’d do the loan check thing and then try the top bet however if that’s still a no-go then stop before you get flagged for too many credit searches.

The level of Bad Debt amongst the Pay Day lenders is huge, largely because they correctly discovered years ago that they’ll make more being the ‘last chance lender’ rather than just pay-day lenders. However they are pretty ruthless and employ a lot of pretty “dirty” tactics to ensure they do get paid more than you think.

Firstly – they ensure they’re first paid – so if you apply they’ll phone your office to make sure you actually work there – they have the details of when people get paid for most if not all the big employers.

Secondly they take payments via Debit Card at 1 min past midnight on payday.

So cancel your card? – that won’t slow them down for long – they can apply for your new card details from your bank who HAVE to give them to them unless you appeal it BEFORE the request – if you do you have about a 30% chance of success. If you do cancel your card they’ll also consider you now hostile which means next pay day they’ll do you for the full amount, plus lots of interest and charges – they’ll also do it in lumps – in case you don’t get paid enough, they’ll do it £100 at a time to get the max they can.

So, close your account and move to another bank? It’s not going to hurt them – card payments, unlike DD payments etc never expire – they can, and will apply from your old bank for outstanding card payments and the bank HAS to pay it – even if your account is closed – now you owe your former bank the money, plus charges and interest.

This will all happen as quickly as 60 days from you defaulting, your credit history will be in ruins from the effects of the defaulted pay day loan and over-drawn bank account, you’ll be getting letters every day from various “solicitors” and debt recovery people – BUT you will have nicked yourself £500 of ‘free’ money.

In Britain thanks to fair and right laws around debt and provision of basic human necessities like utilities, food banks and the NHS NO ONE should ever NEED a pay day loan, but they’re still huge business, some people take them because they’re too proud to be seen in Aldi, some because they’re stupid and quite a lot because of the millions in marketing they spend that makes it sound like a good thing to do and it’s not your fault there’s “too much month in your pay packet”.

I hope one day the whole industry is torn down.

if i heard right this morning on the local radio news – payday lenders have been barred from charging more in interest and fees than the original value of the loan….. anyone seen this on any of the normal news sites

moshimonster – Member

I seem to remember MBNA cancelling the credit cards of thousands of customers who paid in full and on time every month as they weren’t making them any money.

Is that right? What about all the money they must have been making on merchant card fees then? I’ve been paying all my credit cards off in full every month for many years and never had a problem.

I can understand them cancelling dormant accounts and MBNA probably had their fair share of those as people shuffled from one card to the next, but not cancelling active accounts as they should be making some money off every card transaction.

It’s to do with BASEL III rules, in short banks can only lend a certain % of their assets – during the credit crunch lots of banks withdraw unused OD’s and CC’s so they could either fall back inline with BIII or so they could lend that money to someone who’d actually use it – if they offer someone a £10k card limit, even if they never use it, they have to set aside assets to cover it.

if i heard right this morning on the local radio news – payday lenders have been barred from charging more in interest and fees than the original value of the loan….. anyone seen this on any of the normal news sites

http://www.bbc.co.uk/news/business-30000472

I think payday lending has already started to contract in advance of this – I imagine that previously the lenders were making so much money out of those who did pay it back that they could sustain an much higher level of default, so their lending criteria were not exactly rigorously enforced.

I was refused a Capital One credit card. I was 😯 – apparently I’m not a muppet with credit, I pay back ontime and am never late.

I had a spot of trouble a few years back with getting credit and I got my Experian credit history. I found that I had a CCJ from Yorkshire water for £77 – it was from student days and I think my name was on a bill that didn’t get paid, not really my fault as I know I paid everything but maybe a house mate just pocketed the money.

Anyway i rang yorkshire water and they said they didn’t have the records of my account anymore but they said they could remove the CCJ if I paid their costs to do so which were £20. I paid up and it was done – didn’t have to pay the £77. They were very good about it.

So def worth getting your credit record just to check there aren’t any surprises on it.

I have had comnpanies make errors on the recording of completion of mobile phone agreements.

Our mortgage was held up because my wife had a credit agreement in connection with a different address. Turned out it was her mobile phone bill that had “Flat A…” instead of Flat 4…” everything else was correct.

Ironed out quickly because people were involved, but the computer said no.

P-Jay – Member
Get on noddle and see for yourself, it’s free.

top advise that – just done it now, fantastic information on it!

Well, according to Noddle I’m ok, no issues at all. Might give them a call to see what they think the problem was, just out of interest

Just watch, I tried the same thing and Criterion (the financiers) started telling me they couldn’t tell me because of “Freedom of Information”. Well excuse me but after furninshing them with my entire financial history (which they have more access to than I do) the least they could do is tell my why they refused my load application (but oddly enough seemed happy to sell me one at a higher rate of interest, just remembered that bit).

Advertised rates only have to be fulfilled x% of the time, I’m sure the rest are recommended “more suited” products and take them out of panic. Arseholes.

In short they won’t tell you, in fact the criteria apart from some basic ‘must haves’ won’t be available to anyone much below board level unless they’re policy making underwriters and if they did see it, they probably couldn’t translate it – it’s algorithmic.

Honestly, if it’s all ‘good news’ just move on to the nest provider – underwriting these days is getting more like insurance, you could be penalised for sharing some trait or other that’s no fault of your own.

I seem to remember MBNA cancelling the credit cards of thousands of customers who paid in full and on time every month as they weren’t making them any money.

I can’t get rid of mine despite repeated calls. It magically transmuted from an Amazon one when they got bored of giving out points on it (and I only got it for a 10% discount on a telly or something in the first place)

of course the obvious answer is don’t get a loan and only buy the jalopy when you can afford it.

loans just make your future self poorer.

I think you need to read the OP again djambo…….

Car is bought now, I’ve raided the piggy bank.

top advise that – just done it now, fantastic information on it!

+1

Never seen a credit report before….