Loan application declined for no apparent reason

[hollysmum]

Hello! This week, I applied for a personal loan from Natwest to consolidate a few debts, and make my monthly outgoings a bit less, and therefore a bit more manageable. Yesterday, my application was declined, and I was told it was because "certain things" had cropped up on my credit search, and that there had been a represented direct debit. This last matter occurred three weeks ago, and was found to be the bank's fault, and they acknowledged this and refunded me the admin charge that the recipient of the DD had levied on me. I was then very worried about what my credit check might be showing, as I could think of absolutely nothing. I was advised to run my own check on Equifax, which is who Natwest use to do credit checks. I did so, and I was right - there is absolutely nothing on there, and certainly nothing which should mean my loan application was declined. I have read that sometimes, if the bank doesn't think you'll make it any money, it will reject you for that reason alone. I have my mortgage with Natwest, I've taken out loans in the past with no problem, and recently bought some furniture on finance, which clearly wasn't rejected, so I am mystified. The report had not been seen by the adviser at my branch, and my partner has delivered it to him this morning so he can inspect it. He said that if all was well (and I can't for the life of me see why it shouldn't be, in light of my investigations), then he'd submit the application again. I made this application after a great deal of thought, not just on a whim, and I'm now bothered that it would be declined again, there having been a couple of recent searches on my credit record (apparently that can cause your application to be declined, too!!). Can anyone reassure/advise me, in case I go into a permanent decline??!!

[cirian75]

Im with Natwest, applied for a loan about 2 months ago, they insulted me with a 14.9% apr on 15k over 5 years

 

No thanks.

 

They just don't want to lend joe/joanne public money at the mo.

[hollysmum]

Bizarre, isn't it, Cirian75, when they're all making immense profits yet again. No doubt on the back of my overdraft!! I'm still waiting to hear what has come of Customer Adviser Man having a look at my credit report.....

[silverbreak]

As I understand it no bank is under an obligation to lend money by way of a personal loan. Credit scoring is part of the process but isn't a guarantee of success. You mention an overdraft? Was this to be repaid by the loan? You recently borrowed to buy furniture - is this to be be included in the new loan? It wouldn't necessarily be prudent of the bank to lend further amounts. When a bank says a loan has been declined because of 'certain things' it's usually because the branch adviser doesn't want a scene and doesn't want to say 'sorry the bank doesn't want to lend you the money'. This can be for any number of reasons but usually because they don't want to pick up other institutions loans on an unsecured basis. Despite what people hear about Banks being told to lend more money they are also very wary of future 'bad lending' not that I'm suggesting this is the case as regards to you.

[hollysmum]

Hello, Silverbreak, thank you for your reply. I appreciate they don't have to lend anything to me if they ultimately don't want to, but really, when they come back to you, having declined your application for "certain things" and don't tell you what those are, it is really worrying. I was imagining all sorts of terrible things that even I didn't know about cropping up on the credit report. Yes, I have an overdraft, but I've had one for years, and it's not even a very large one. I have my mortgage with them, again, not a very large one (which is quite nice, these days!), and my furniture was not purchased using a loan from the bank, and I paid a large deposit for it, leaving, yet again, a relatively small amount outstanding. I want to update my kitchen and bathroom, as well as pay off these minor debts, so I would see this loan as being an investment, as it would enhance the value of my property, and therefore their interest in it (my mortgage). I applied for a Home Improvement loan from my local council to try and get these works done, but was told I earn £400 a year too much!!! The council actually condemned my bathroom (eek!), so you'll see that I'm becoming just a little bit desperate now! My house is up for sale, in any case, but people take one look at my poor bath, swiftly followed by my not-so-fitted kitchen, and run a mile. I have no savings to fund the necessary work, since I divorced, all I am asking for is a little monetary assistance, and really, the bank can't lose in this case.

[hollysmum]

Hello!

I am having real hassle at the moment with an application for a bank loan.

I've never, ever had any problems before with getting one of these, or credit of any kind, and the response from my bank suggests that something has happened since December 09, when I easily obtained credit to buy some furniture.

 

All the adviser at my bank can tell me is that a "default" is showing up.

Now, I know that these checks are carried out on an address,

and my sister has suggested to me that what is showing up is my partner's recent arrangement with his car finance company to reduce his payments for a short period of time.

 

This arrangement was made quite properly,

it is clearly on his record with the company,

yet it is the only thing I can think of that might be popping up.

 

I have certainly not defaulted on anything,

and technically,

neither has he,

as it was agreed with the finance company.

 

He did this because his work can fluctuate,

and he'd had a rather lean month in March this year.

 

Rather than completely miss payments,

he quite rightly contacted the company to make this arrangement,

and they were very helpful.

 

This is the first time in nearly four years that he has had to do anything like this

- he's never, ever missed a payment.

 

We have received a stack of "stock" letters from the finance company,

endlessly telling him that his account is in arrears by however much, blah blah,

 

but then we get another letter confirming his arrangement to pay half for however many months!

 

Getting this bank loan would seriously help us out in more ways than one,

and I want to get this sorted.

 

I'm waiting on two further credit checks,

having done one with Equifax (used by my bank),

on which zilch showed up.

 

I am also incensed that no one has the decency to tell me exactly what is causing this problem (the car finance is only a guess),

 

when they know what it is,

and I have to waste time and effort finding out for myself.

 

Would my partner's reduced payment arrangement be a likely cause of this sudden crash in my previously-good credit rating?

 

If so, how can I tackle this

, and reinstate my rating?

 

Why would a properly-arranged agreement to pay less for a specified period of time cause such a huge problem?

 

Sorry to ramble on, but it's seriously worrying me.

[IdaInFife]

If you are linked financially to your partner i.e. via bank accounr or other laon etc then anything on your partners file will mirror onto yours. Unfortunaltely a payment arrangement can be places on your file normally for 6 month at a time and this is just as bad/equal to a default which will effect your credit score as this shows that you are having financial difficulties with your current situation which means most companies will not entertain in providing a loan to some already under strain.