Loan application declined - What are my options now?

delboi101

Hi.

So I got a call today advising me that my loan application with PTSB for €3500 for turned down.

Bit of background. I told them during the loan meeting that for the past 6 months, there's been a €142 deduction from my wages before it hits the bank for a cycle to work scheme. This is the last month of the scheme meaning that I'll have an extra €142 give or take, to play with each month.

She asked me to get a letter from the job to prove this which I did today and was to drop up to the bank.

Long story short, they told me today that in order to be approved I need to save €142 for the next month. I said to her "I'm actually in the office collecting the letter you asked for" and she simply said "Yeah but you'll still need to save for the next 6 months".

The over all impression I got (It was difficult to tell, the girl on the phone seemed she didn't care and was just a call she wanted to get off) was that it was due to my lack of savings. I've zero debt ,never had an overdraft and never missed a payment on a loan I had a few years back with AIB.

So, what are my options?

I was thinking of applying for a smaller amount spread over a longer amount of time: €2500 over 48 months as oppose to the initial application of €3500 over 42 months - will this make any difference?

Also, what about applying for a loan with a bank other than my own?

I'm surpised that the girl didnt say anything along the lines of "you could try applying for a smaller amount or spread the payment term over 4 years instead of 2. She literally just said about needing to save for 6 months and that was it...

Thanks in advance

darlett

€3500 seems quite little for you to apply for and then be turned down for with your clean credit history. If its for some valid reason, say a car or whatever and I was you, I'd open an account with a local credit union if you dont have one already, and then take it from there. With their system they usually want you to leave something on deposit in the account while you make the repayment, Interest rate is about 9-10% and if you already have a family member as a relative this can help if they would be prepared to guarantee you.

delboi101

I didn't think that what it was for had much bearing on whether the loan was approved or not.
It was for an engagement ring and I told them (thinking honesty would be the best policy an all....)

Just to rule it out, I've asked for a call back tomorrow and am going to apply for €2500 over 48 and see what happens. I'm going to get a credit report from the ICB just to suss that out too.

If I get turned down again, I'll open a credit union account as pretty much everyone I said it too about going for a loan recommended them.

Thanks for the reply mate.

delboi101

Just as a matter of interest, would I need to be saving long in the credit union before applying for a loan? I'm assuming I can't just set up an account and on day one ask for a loan. I think I'll need to put the ring on hold for a few months regardless of where I get the loan...

km79

delboi101 wrote: »

Just as a matter of interest, would I need to be saving long in the credit union before applying for a loan? I'm assuming I can't just set up an account and on day one ask for a loan. I think I'll need to put the ring on hold for a few months regardless of where I get the loan...

Ifs it's your local credit union in a smallish town you will find it a lot easier to get a loan straight awa BUT ya will have to have lodged 1/3 of what you want to borrow which you will not be able to withdraw . That's the way it works in my credit union anyway . At all times you must have 1/3 of the loan saved as shares. So as it decreases ya can withdraw a little

delboi101

km79 wrote: »

Ifs it's your local credit union in a smallish town you will find it a lot easier to get a loan straight awa BUT ya will have to have lodged 1/3 of what you want to borrow which you will not be able to withdraw . That's the way it works in my credit union anyway . At all times you must have 1/3 of the loan saved as shares. So as it decreases ya can withdraw a little

Ah right. I get you. So to get a €2500 I need to put around €950 in as reserve for them I suppose.

Its a relatively small town and I may know someone who works there (not sure if that'll make any odds)

Thanks for the response. I'll keep it open as an option. :-)

km79

delboi101 wrote: »

Ah right. I get you. So to get a €2500 I need to put around €950 in as reserve for them I suppose.

Its a relatively small town and I may know someone who works there (not sure if that'll make any odds)

Thanks for the response. I'll keep it open as an option. :-)

It's different in every one but that's the usual rule of thumb or it was anyway. I also knew someone in mine. Put 1500 in to get 5000 loan. On the day I opened the account :@ that was 7 years ago though.

delboi101

km79 wrote: »

It's different in every one but that's the usual rule of thumb or it was anyway. I also knew someone in mine. Put 1500 in to get 5000 loan. On the day I opened the account :@ that was 7 years ago though.

Thanks for the info. I'm going up on Thursday night to inquire.