Some Loan Advice

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Toffeewoffee

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I have never (until now) taken out a loan or credit card, so i am a bit of a novice.

Last week i applied for a loan through Hitachi Finance who i know are a reputable company, low interest rate at 7.9% APR for the amount and term i wanted. However my application was declined, on the letter my surname was spelt wrong by one letter, so i am not sure if this was the reason or maybe its a lack of credit history that has gone against me? I have tried phoning Hitachi and experian who ran a credit check on me and can only get through to robots and told to email which i have done.

Would a spelling error in my surname cause me to be delined?

I am worried to apply again incase i am again declined and end up with a bad credit report despite never having any credit!

Are there any other Loan companies you would recommend, I am only looking to borrow £3000.

Thanks
 

sharonS

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This seems to be a very high interest rate, I don't wish to insult you but have you checked out the intenet for offers?
However looking again a moment ago that doesn't seem bad.
 
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Toffeewoffee

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This is the lowest i have found, the more you borrow the better the rate obviously.
 

flintstones

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It might be worthwhile checking your credit file with creditexpert as they can suggest what companies you maybe likely to be accepted by. I don't think the spelling error should cause a decline as it's matched up to your name, date of birth and address. It's likely the fact you've never had credit is going against you unfortunately sometimes having no credit is as bad as having bad credit :-(.
 

Toffeewoffee

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Ok, so a little update, i have spoken to freedom finance who were very helpful in explaining everything to me. I have also joined experian to check out my credit rating, I am just waiting for the pin to come through so that i can check my credit report.

Freedom finance did a soft search on approx 15 different loan companies for me and only one come back to say they would accept me (slightly hurt) but their interest rates are too high. So I am forgetting the whole loan idea for the moment, but i clearly need to build up some credit history as having none is not doing me any favours. I have decided to apply for a credit card which will be used for my food and petrol ONLY! And i will pay it off in full each month.

A few people suggested an M&S credit card as it is apparently one of the most beneficial, having looked into it they offer interest free on shopping for 19 months, 55 days interest free credit and points which add up to M&S vouchers. All details in the link below. Sorry to be so ignorant but i have some more questions for the more financially savvy amongst you.

http://bank.marksandspencer.com/ban...iew/?WT.mc_id=MASM_RET_14_CCB#further-details

As you will see the APR is 18.9% is this the interest I will pay AFTER the initial 19 months as the first 19 months is interest free, or is this the interest I will pay if i do not pay the balance off in full each month within the first 19 months? If for example i spend £100 on shopping a month and only pay back £50 a month will i pay any interest in the first 19 months?

Same for the 55 day interest free credit, I assume normal credit cards are 30 days interest free credit, so an additional 25 days from M&S, again is this after the initial interest free 19 months?

I find it all very confusing, I have always tried to live within my means only having and spending the money i earn, so i have never had a credit card or loan, hence why i am finding it so hard to get credit/loan. Also I wont be applying for a credit card until i have seen my full credit report from experian when my pin comes through.

Thank you in advance for your help and input.
 

flintstones

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The first 19 months will be interest free so you don't have to pay it every month but make sure and clear the balance before they start charging interest. Credit Cards are very useful things if used correctly they can also do the option and get you in bother. Just remember you have to pay it back a lot of people think free money this isn't the case.

After the 19 months you'll have to pay the balance in full every month to avoid interest.

Also might be worth checking who would accept you for a credit card before doing another credit check.

It's hard starting out in the credit world.
 

Toffeewoffee

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Ok, thank you to you both. it now makes sense, I know you aren't experts, but what is the likeyhood of someone with no credit history being accepted for an interest free credit card? x
 

MyGuineaPigPals

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I got my first loan straight from Natwest, I took out £1000 and arranged it by just going for a meeting with them. I then paid it back early when I had the cash. I have since taken out a credit card with Natwest too and although my limit is 1800 I only have to pay back £15 per month on it (although I have now just paid it all off and given the card to my friend to look after for me so I don't use it all again) I have tried countless times to sign up for experians free trial which says it will give me my credit rating however they have never completed my application and I have since given up. I refuse to pay a subscription to gain the answer to one question. I really need to find out my credit rating though as I want to get a mortgage and don't know where to start :(
 

doglovinpiggylover

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i agree with the no credit history being the problem Chloe. You need to get little things that get your creding rating going. It all seems daft i bet but they need to know you will and can pay back.

I hope its not all to buy a stash of stuff for your coffee machine lol
 
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