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My credit rating is great, so why don’t I get the best rates on loans or credit cards?

My credit rating is great (and I have a million pound house), so why am I not getting the best loan and credit card rates?

People with supposedly perfect credit scores are puzzled by lenders who don’t offer them the best rates. on the loan.

Several readers with “excellent” credit scores have contacted This is Money in recent weeks, baffled by what they perceive to be arbitrary decisions not to give them the best advertised rates on credit cards and loans.

These include a businessman with a £ 1million house, a ‘perfect’ credit rating and a comfortable income and a business manager, with an excellent rating, who wanted a credit card. credit without commission on withdrawals abroad.

Credit Attack: People with great credit scores find that they don’t get the best rates on credit cards and loans.

Lenders need only offer the best representative APR rates advertised to 51% of successful applicants, in accordance with the EU Consumer Credit Directive, and in theory, those with the best credit scores should get the best credit scores. best deals.

But the credit scores given when entering your details on websites like Experian are only guide scores, and the score calculated by lenders based on a person’s credit report information gathered. from credit rating agencies (CRAs) may differ.

And Experian said financial histories collected from rating agencies – which cover a person’s transactions over the past six years – are only part of a bank’s decision-making process, the information provided in the forms. request and information that banks already know about a borrower are also taken. into account.

Banks are also looking at statistics on previous applicants with similar circumstances and personal situations, to see if they would make a good client.

Nonetheless, many apply for credit with the belief that the excellent credit scores given to them on rating websites will allow them to get the best loan and credit card rates, only to end up disappointed.

James Jones, of Experian, said lenders do not publicly reveal the specific criteria they look for when considering which credit applications to accept and which to grant the best rates, as this could potentially leave more room for fraud attempts.

But he added that anyone who was denied credit should be told by the lender why it was turned down – provided they ask for one.

This is Money spoke with a consumer loans executive, who explained that while credit report information is important, banks are also more likely to offer the best rates to their own bank customers.

They said, “We’re focused on the data we have, a lot of that is available in the credit score, but the other place we’re looking is how the applicant handles their relationship with us.

“We are looking at whether they have their mandated salary on their checking account, how they handle their debits and invoices, and our day-to-day relationship with the borrower.

“This allows us to better understand a borrower than what is found in reports from credit reference agencies alone.

“Our main loan is focused on our existing clients, those who already do business with us.

“If someone who does business with us, manages their account well, has a great credit rating and a good monthly income, those are the types of clients we are looking to offer the best rates.

“There may be factors that affect the rates offered regardless of their credit score up to a point, they may be managing their own accounts very well, but they are heavily in debt.

“We can look at the total credit they currently have and we may not want to lend to someone who already seems relatively committed.”

The man with a million pound house who can’t get the best rate on his credit card


A business manager, who asked not to be named, contacted This is Money after Halifax failed to offer him the representative 12.9% APR rate advertised on his Clarity credit card.

The 55-year-old from Essex retired a few years ago after selling his business and is now the manager of a new business he formed to keep himself busy.

His UK home is worth around £ 1million, he also has an overseas home worth £ 400,000 and a comfortable annual income.

His credit score according to Experian is the perfect 999 and he applied for a Clarity card because it does not charge a commission on overseas cash withdrawals.

But he was flabbergasted when his credit card showed up and found it had an interest rate of 21.9%.

He said: ‘I have never had a judgment against me, missed or paid late payments owed to anyone.

“The only credit I have outstanding is for a bed I bought at no interest and a new BMW car at a very low interest rate.”

When asked to explain his decision, Halifax said, “We take a number of factors into account in deciding what rate to offer our clients, including details provided to us by the referral bureaus of. credit that we use and our own internal data.

“The application went through the same process as all Clarity Card applicants, and our policy and procedures were followed correctly.

“It is important to note that all of our advertisements highlight the fact that this is a representative rate and not the rate guaranteed to all successful applicants.”

I have a credit score of 963, but Santander offered me a loan rate almost double that advertised


A woman, who declined to be named, was offered a 12.9% rate on a five-year £ 20,000 loan to buy a car in Santander, almost double the advertised rate.

She is a 54-year-old business manager and had applied for the loan believing she would be offered the advertised 6.7% rate, with an “excellent” credit score of 963 with Experian.

Her report says she has just £ 680 in unpaid debt – excluding mortgages, using only 1% of her total available credit and has had no missed or late repayments in the past year.

She now finds herself in a dilemma, because applying for another loan so soon after Santander’s would have a negative impact on her credit rating.

She said, “They advised me not to apply for a loan elsewhere because further research would hurt my credit rating.

“I have been an Abbey / Santander customer for ten years and my credit is excellent.

“Needless to say, I was furious.

‘The only’ negative ‘in my credit report according to Experian was Santander’s research for the personal loan!’

In response, Santander said, “While we cannot comment on the details of this matter, we are continuously monitoring the completion levels of our advertised rates for unsecured personal loans to ensure that at least 51% of customers receive the representative rate.

“Typically, over 60% of our customers actually receive the representative tariff within a promoted tier, which is well above current regulatory requirements.

“Loan applications are considered on a case-by-case basis and, in line with many other UK lenders, we operate a ‘risk-based’ loan pricing model which assesses both clients’ ability to repay the loan and their performance. secured and unsecured credit behavior. “

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