Getting finance when resident less that three years

jonnyfingers

Hi all,

Just wondering if anyone has been in a similar situation as me and can provide some advice.

I'm about to start a new job and will need to travel a bit so was looking to trade in my current car, which I paid for with cash and, hence, isn't the best, and get a newer one. I've been living here since March 2011, have had a good and regular salary, bank accounts, a credit card, am on the electoral roll and I have a very good credit history last time I checked my score. However I applied for a car loan and was refused as I haven't been living in the country for a minimum three years.

I'm just wondering is three years the limit for most lenders? Or are some willing to lend if you've lived here less time but have a good credit history?

Also my fiancee and I are considering buying a house in a year or two. She's also Irish and has been living here only a few months more than me. Is there a minimum time you need to be resident before you can get approved for a mortgage?

83ste

I asked about this in relation to mobile phone contracts, and a salesperson told me that it depends - if you've been here less than three years, you might be approved for lower amounts but not higher ones. For amounts large enough for motor or home finance, I'd say you would have to wait three years, yes.

Fysh

Three years tends to be the minimum, but it varies based on a bunch of (largely arbitrary) criteria - including, for example, the general creditworthiness of previous residents at your address.

Did you talk to whatever loan provider you applied with that refused you? They may be able to offer advice on what to do to increase your rating and likelihood of future successful applications.

Marcusm

jonnyfingers wrote: »

Hi all,

Just wondering if anyone has been in a similar situation as me and can provide some advice.

I'm about to start a new job and will need to travel a bit so was looking to trade in my current car, which I paid for with cash and, hence, isn't the best, and get a newer one. I've been living here since March 2011, have had a good and regular salary, bank accounts, a credit card, am on the electoral roll and I have a very good credit history last time I checked my score. However I applied for a car loan and was refused as I haven't been living in the country for a minimum three years.

I'm just wondering is three years the limit for most lenders? Or are some willing to lend if you've lived here less time but have a good credit history?

Also my fiancee and I are considering buying a house in a year or two. She's also Irish and has been living here only a few months more than me. Is there a minimum time you need to be resident before you can get approved for a mortgage?

What credit card limit did you get and from what lender? If the car loan was via a dealer or car broker, I'm not surprised as they will likely be set up to deal with bog standard approvals - volume is more important for them. Have you tried for a personal loan from your bank or the card issuer?

okiss

I would talk to your bank about getting a loan for a car as you have not been living in the Uk for less than 3 years.

I would also look at http://www.experian.co.uk.

The above are the largest credit reference agency in the Uk and they offer a number of different services. This site also explains and answers any questions you may have in regards to your credit score and credit history.
They also offer advice on how to improve these.

jonnyfingers

Thanks guys.

To answer some of your questions, I have a credit card with Tesco and the limit is £2500. I tried to get a £10,000 loan with Tesco and they called me to say I must be in the UK a minimum of three years to get any loan amount.

I checked my credit score a few months ago and it was 997 or something, so unless that's dropped for some reason I think only the amount of time I'm living here is counting against me at the moment.

I bank with First Direct so I'll give them a call and see what they say. One thing I don't want to do is start applying for loans everywhere, just in cast that has a negative effect my credit score.

If it turns out three years is the limit then it's not the end of the world. I can still use my current car, once I pay for some repairs, and then, if anything, I can save up for a year so I have a nice chunk of cash to put towards a new car!

Thanks for your help.

Lump

Start at your own bank, they have a much better idea of your income and outgoings, it'll be easier for them to approve a loan.

John

Marcusm

jonnyfingers wrote: »

Thanks guys.

To answer some of your questions, I have a credit card with Tesco and the limit is £2500. I tried to get a £10,000 loan with Tesco and they called me to say I must be in the UK a minimum of three years to get any loan amount.

I checked my credit score a few months ago and it was 997 or something, so unless that's dropped for some reason I think only the amount of time I'm living here is counting against me at the moment.

I bank with First Direct so I'll give them a call and see what they say. One thing I don't want to do is start applying for loans everywhere, just in cast that has a negative effect my credit score.

If it turns out three years is the limit then it's not the end of the world. I can still use my current car, once I pay for some repairs, and then, if anything, I can save up for a year so I have a nice chunk of cash to put towards a new car!

Thanks for your help.

It doesn't surprise me that Tesco Bank turned you down as they are an organisation that needs to take a very cookie cutter approach - previously they were aligned with RBS, now that they are on their own, they need to limit complex cases. Cards are regarded as different as experience shows that people ind ebt will often prioritise credit card debt above even mortgage debt.

First Direct is basically a telephone operation for HSBC, in the past they were much more independently minded. HSBC does not, I believe, have a blanket policy in years of residence to obtain loans. Their credit scoring will take account of a number of factors including external credit reference agency reports but these are not the be all and end all. Call First Direct and ensure that they don't have a residence policy prior to making an application. Make sure they have up to date details on your job, whether permanent, whether you've served your probationary period etc.

harney

I would imagine these restrictions have come in due to the recession and all the banking crises. When my girlfriend and I arrived in the UK in '05 we had mortgage approval within about 8 months from Lloyds. It is hard to say if this type of thing is still possible.

It might be worth starting a savings account in something like an ISA account. Even the pattern of small regular deposits will help improve you ratings even more.

http://www.moneysavingexpert.com/savings/best-cash-isa

You might get some useful information here

http://www.moneysavingexpert.com/

jonnyfingers

Just an update. I asked First Direct if they have a policy on minimum length of residency and they said they didn't. So I applied for the loan online and got the money straight away.

Thanks for your help.

Lump

I found the same when I got my mortgage. Lots of banks offering great rates, but the only bank that would lend me a decent amount of money was my own bank, and the rate was only slightly less competitive.

bill_lehane

Glad to see you got sorted, jonnyfingers! I've been thinking about this myself lately after a certain big green bank refused me a credit card last month because there was 'a credit decline on my account'.

The lady even sat me down in the branch and said patronisingly as if she were addressing some kind of young offender, 'is there any reason you can think of for that'. The cheek of her! (To be clear, I don't have any actual credit problems whatsoever.)

I've been in London two years and they did turn me down for a credit card upon setting up the account which i wasn't bothered about, but by now it just looks like plain racism.

So I checked my credit with Experian and I have a good rating. Go figure. Went instead to a certain big blue bank and they gave me a credit card right away.

I guess it depends on the bank you go to and perhaps every experience is different. Ironically I picked the green bank in the first place because they had fewer proof of address-type requirements for setting up a current account.

silvervixen84

bill_lehane wrote: »

Glad to see you got sorted, jonnyfingers! I've been thinking about this myself lately after a certain big green bank refused me a credit card last month because there was 'a credit decline on my account'.

The lady even sat me down in the branch and said patronisingly as if she were addressing some kind of young offender, 'is there any reason you can think of that'. The cheek of her! (To be clear, I don't have any actual credit problems whatsoever.)

I've been in London two years and they did turn me down for a credit card upon setting up the account which i wasn't bothered about, but by now it just looks like plain racism.

So I checked my credit with Experian and I have a good rating. Go figure. Went instead to a certain big blue bank and they gave me a credit card right away.

I guess it depends on the bank you go to and perhaps every experience is different. Ironically I picked the green bank in the first place because they had fewer proof of address-type requirements for setting up a current account.

The big green bank turned me down too for a credit card. I also checked my credit report and it was grand. I've been here 3 years so hopefully that's the magic number and I'll get one soon.

bill_lehane

silvervixen84 wrote: »

The big green bank turned me down too for a credit card. I also checked my credit report and it was grand. I've been here 3 years so hopefully that's the magic number and I'll get one soon.

Aha! Glad (well not glad but you know what I mean) to hear i'm not the only one I forgot to say that the Experian people supposedly have the inside track on which bank is more or less likely to lend to foreigners, but you have to subscribe to their website for that.

harney

It might be worth popping into your branch one Saturday and having a chat with the bank people. They are often quite friendly, and will advise if they can what the issue might be.

bill_lehane

harney wrote: »

It might be worth popping into your branch one Saturday and having a chat with the bank people. They are often quite friendly, and will advise if they can what the issue might be.

Yeah you're probably right but to be honest, having been turned down twice I can't be bothered, especially when another bank is giving me what I want straight away. Voting with my consumer feet!