The information contained within the following news articles have been pre published. The articles were published on the dates indicated and the information contained within these issues include references to taxation, legislation, regulation and other issues or concerns that may no longer apply
Five common reasons why you may have been turned down for credit
It can come as a shock to be turned down for a loan or credit card. But as banks' bad debts have escalated, so too have they become more discerning about whom they lend to, which means the best deals go to those with excellent credit ratings.
Here are five common reasons why you may be turned down for credit.
You’ve no history of borrowing
Lenders prefer a borrower to have a steady history of debt repayment, so they’ll favour new customers with credit reports that show they can manage credit responsibly.
You don't fit the lender's profile
Lenders tend to target a specific group or group of borrowers and you may not fit their profile at that time. For example, they may want customers within a certain age bracket, or from a specific socio-economic group.
Your credit report reveals too many searches
When you apply for credit, the lender will do a search on your credit report. This leaves a ‘footprint’. So if you apply for credit from several lenders in a short space of time, it may appear you are building up too much debt, even though you aren't actually taking out the products.
You’ve a history of financial trouble
You may be financially sound today, but missed credit repayments stay on your record for three years, and lenders may take a dim view of your past. A County Court Judgment against your name will be held on file for three years, while bankruptcy restrictions can remain on your record for up to six years.
You aren't on the electoral register
This is one of the most common reasons why people are turned down for credit. Lenders use the electoral register to check you are who you say you are and that you live where you say you live. The solution: register at once.