Very confused with credit report

[numnum]

can anyone help me

i've very confused. me and my boyfriend are finding we're having bother getting a loan

we're looking for about £10-15k, whatever possible, but there saying no even though we're both in no debt and have a good payment history and a good income

i read on here before that we should open accounts to show we're good payers, even though we can prove that with our car loan. so opened one catalogue account and been paying it off every month

we did get a letter to the house saying they were sending debt collectors for the previous owner. i contacted them and they said that was probably not the reason why we were getting declined things

we've also registered with credit expert website experian and there is nothing saying we have any problems. it even comes up in a red box saying we have no outstanding debt etc so we are very confused as we've done everything we've been advise and thought we'd get answers when we paid for a credit report.

can anyone help

[Buenchico]

Have you got any credit cards, even if you owe nothing on them? Here's the reason I ask:

Let's suppose that you've both got three credit cards, with a limit of £3000 on each of them. However you don't owe a penny on any of the cards. Even so, when you apply for a bank loan the lender won't take much notice of the fact that you owe absolutely nothing on those cards. What will concern the lender is that you could both 'max' all of your cards tomorrow, without the need for any authorisation. So the lender will treat your application as if you already owe £18,000 between you on those cards, even though you've no intention whatsoever of actually using them. If the lender thinks that you can't handle debt of more than £18,000, your loan application will then be refused.

Chris

[numnum]

No we have no credit cards, £1000 overdraft which we are not in and owe £1500 on a car which only has a year left on it

[factor-fiction]

It may depend on how much you mean by 'a good income'. Lenders will be concerned if there is no security for the loan and may be cautious because although your income may seem good you haven't been able to save from it before now and now need a loan, so what makes you think you can afford the pretty hefty repayments. In other words they may assume you are living beyond your means. For example borrowing £15000 over 5 years at an interest rate of 10% would need repayments of around £320 a month for 5 years. Where would that money suddenly come from.

Another factor is that they used to make money on PPI and this offset some written off losses on loan defaulters but they are now less likely to want to sell PPI because of people using hindsight to claim misselling in later years.

Having said that, if their business is providing loans they should be able to find a price (at maybe nearer 15% pa) at which they would lend.

This doesn't really help I know. Maybe forget the loan for now, get a credit card with a fairly low credit limit initially, pay it off on time for a few years, and build a good credit record.

Do you have a mortgage? Could you add the loan to that?

[numnum]

hes on £30000-35k a year i work part time

the loan is to buy a family house for £15000 and then we would move into it. so we would actually then be paying less back on the loan than we are paying out in rent now.

we already have about £800 to spend once bills, food, heating etc is paid for so its not like we're short of money and we've nearly paid off our car loan so that will be more disposable income every month

we're needing to get everything sorted soon as the sale is about to go through. one family member was going to buy it and now we're taking it over so really need the loan sorted and not got the time to try and raise our credit score

called a financial advisor today and he's confused. he said with our score of 853 its quite good and shouldn't have been declined

we have some savings but not enough and the reason we don't have more is we were eventually going to buy the house we're in so have been doing it up with all our spare money now this opportunity has come up at the last minute

[Hawkwalk]

I see one potential issue here. You are looking to buy a house for 15k off a family member which if correct would appear to be well below market value. There are serious implications to not paying near market value for a house which the inland revenue may be interested in.

Also I can not understand why you would pay money to do up a house that is not yours thus spending all your savings - how did you intend to fund the purchase of that house?

There may be a few details that we are not aware of that is preventing a loan being approved

[numnum]

hi hawkwalk

its very confusing. its a family house that was given to the member as a gift who was never meant to sell it. now they are selling it. its an old house which isn't worth much but more for the family memories and to keep it in the family.

if the family member did put it on the market it would be on the market for years as it is needing a lot of work and also in the middle of no where and houses don't sell well here, its an area where houses tend to be left to family members or people build their own house. not buy an old house. so this is the quick fix for them to pay for their next house

we done up our house as we were intending to buy it in a couple of years. so we were going to spend the next couple of years saving for the deposit of this house

we now have the opportunity to get the loan and the family house, do it up and have it all paid for by the time we would be able to buy the house we're in. by that time i'll be full time and partner will be on a higher wage

[bushbaby_de]

Is the problem that you are trying to get a loan to buy a house when what you need is a mortgage?!

[numnum]

apparently you cant get a mortgage for such a low amount

[bushbaby_de]

hmm never heard of that before - so are you going for secured loans or non-secured loans?

[numnum]

it would be an unsecured loan as we do not own the house we live in

we did have a mortgage on a property a few years ago and had an unsecured loan on that. we never missed a payment on our mortgage and paid off the unsecured loan of £7000 in a year. we also sold that property and came out of our mortgage and got £4000 fines for that and paid that off in the same year so the banks will be able to see that we are good payers. and that was paying that off on top of £500 a month mortgage

but i don't know if this will go against us. from speaking to the financial advisor he doesn't think so.

[numnum]

got a loan for half the amount. another family member who doesn't want the house out the family is going to put up the other half. phew

thanks for all your advice