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    Loans grrrrr!

    Im trying to get a loan and i applyed and was succesful but when i looked at the doucments they had timed the APR by 3! I tried someone else and i was declined a loan. I have no idea why though. Ive never missed any payments or been in debt. I dont even have a overdraft. I have an argos card but havent used it yet. I have a well paid job and work full time

    21 Comments

    OH DEAR.. that doesnt sound good.. have you done a credit report to see if there's anything against your name that shouldn't be? ?

    Banned

    Having no credit can be as bad as having bad credit.

    master_chief;7950177

    Having no credit can be as bad as having bad credit.


    This was my first thought. Have you actually built up your credit rating in any way?

    The more you borrow and pay back to different cards/loans etc the better your credit rate will be,which in turn will make it easier to borrow more ...................complete madness!

    I had this problem because I had never applied for a loan before they wanted a higher rate of interest from me. Unfair but thats the way it works

    It is probably a typical APR, If you haven't got a credit record you are not a good risk so they will have upped it based on this fact.

    Original Poster

    so am i best to pay the high rate? that way next time it will be easier? otherwise im never going to be able to borrow money

    Banned

    It is a crazy system but I found myself in a similar position a few months ago. I had bad credit problems nearly 10 years back, cleared all my debts a few years later so when I checked my credit rating last year it was fairly ok, I had no bad credit on record anymore so thought I'd be ok. Unfortunately I got turned down for everything until I got my first mortgage in November. Went into bank in December about an unrelated matter and they gave me a credit card there and then, I was preapproved for one so didn't need to apply, £3k limit with 12 months interest free on purchases!

    lincolnsmommy;7950216

    so am i best to pay the high rate? that way next time it will be easier? … so am i best to pay the high rate? that way next time it will be easier? otherwise im never going to be able to borrow money



    Yes, the other alternative is to spend money on your card and pay it off over a period of months (or spend every month and clear it in full). The bank wants to see that you are capable of meeting monthly payments over a reasonable period of time.

    You could shop around but doing multiple credit searches during a short space of time can damage your credit rating too.

    Banned

    StudentJo;7950241

    Yes, the other alternative is to spend money on your card and pay it off … Yes, the other alternative is to spend money on your card and pay it off over a period of months (or spend every month and clear it in full). The bank wants to see that you are capable of meeting monthly payments over a reasonable period of time.You could shop around but doing multiple credit searches during a short space of time can damage your credit rating too.



    They may prefer you actually pay interest rather than always paying off the full balance every month.

    I think you're best to avoid more than 3 applications in a 6 month period.

    Original Poster

    im worried about that. I dont want to damage my rating. i dont have a credit card though! only a debit card. I need the money asap for a car. maybe ill just pay the rates

    Banned

    I have a well paid job and work full time

    My sound like a stupid question, but why do you need a loan then?

    Don't get a loan love, just save up from your well paid job until you have enough to buy what you want...

    This was you pay 0% APR and get the nice feeling of owning the item/s from the day of purchase. :thumbsup:

    Are you on the electoral roll? as that can cause problems if you are not

    Banned

    JonnyTwoToes;7950259

    I have a well paid job and work full time :(My sound like a stupid … I have a well paid job and work full time :(My sound like a stupid question, but why do you need a loan then?




    Yes that is a stupid question!

    master_chief;7950257

    They may prefer you actually pay interest rather than always paying off … They may prefer you actually pay interest rather than always paying off the full balance every month.I think you're best to avoid more than 3 applications in a 6 month period.



    The card company would obviously prefer this but as far as building a credit rating goes it is just as effective to spend each month and pay off in full.

    Have you checked to see if there is a hire purchase possibility for whatever you want the loan for? If it's a car than that may well be the way to go.

    lincolnsmommy;7950258

    im worried about that. I dont want to damage my rating. i dont have a … im worried about that. I dont want to damage my rating. i dont have a credit card though! only a debit card. I need the money asap for a car. maybe ill just pay the rates



    I meant your Argos card but if you need the money ASAP I'd just go with the loan or do one more application to compare. I'd recommend checking the lowest rate providers on moneysavingexpert or applying with someone who do not advertise a typical rate, this way it will not be risk-based.

    Original Poster

    i want a car. Maybe finance through the dealers is the best way to go? I have just rang the people who i was having the loan with and as i said i thought the loan was a bit high they have cancelled it! i now have no options. If i try again like you all say i could damage my rating even more am i more likly to get finace on a car then a loan or is it the same? x

    lincolnsmommy;7951490

    i want a car. Maybe finance through the dealers is the best way to go? I … i want a car. Maybe finance through the dealers is the best way to go? I have just rang the people who i was having the loan with and as i said i thought the loan was a bit high they have cancelled it! i now have no options. If i try again like you all say i could damage my rating even more am i more likly to get finace on a car then a loan or is it the same? x



    It most likely won't be cancelled, they will probably reactivate it if you ask. If not complain, as the loan offer was made you should have the chance to make a decision on it. The underwriters will be able to look at your app again without credit checking you. what bank is it with by the way?

    lincolnsmommy;7951490

    i want a car. Maybe finance through the dealers is the best way to go? I … i want a car. Maybe finance through the dealers is the best way to go? I have just rang the people who i was having the loan with and as i said i thought the loan was a bit high they have cancelled it! i now have no options. If i try again like you all say i could damage my rating even more am i more likly to get finace on a car then a loan or is it the same? x



    Finance through a can company will also be a credit agreement, lots of good advice on the thread. Credit scoring is calculated by amount of credit repayed, regularity of payments, refusals of credit etc. so paying off a credit card in full each month is good for your rating.

    Depending on how much the loan is for, it may be worth taking a higher APR, as this may get you going.

    Make sure you do comparisons, and try to pay off the full amount in as short a time as is possible for you. (without stretching your finances)
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