Struggling to get a loan? You’re not the only one

Posted in 'Personal Finance' by Richard Catlin

07 May 2010

One of the most noticeable effects of the recession has been the contraction of available credit, with all forms of personal finance harder to come by. The news recently that celebrity chef Jamie Oliver – worth a reported £65 million - has also struggled to finance the expansion of his business recently shows that almost no-one is immune.

Whilst Jamie’s own credit requirements are likely to be very different to yours, it still serves to highlight how tight lending markets continue to be.

One bright piece of news is that the Bank of England has reported that net personal loan borrowing was up £0.1 billion in March compared to the same period last year. If your credit rating is good, rates such as the 7.8% available from Alliance & Leicester, (or slightly more from Zopa, depending on how much you wish to borrow), remain competitive.

With the contraction of the housing market, many homeowners have passed up trying to sell their home in favour of improving their current residence ready for when things start to recover, and lenders seem to be showing slightly more hunger for business.

If you are approved a loan, the rate you’ll be asked to pay is largely determined by what is held about you on your credit file. Even if you’re not looking to get credit right now, it’s important to know what information lenders will be looking at if you do apply in the future, and that it is all correct.

You can check your credit file based on all three UK credit reference agencies together in the same easy-to-understand format with checkmyfile.

If for any reason you find that anything on your file is incorrect, we’re here to offer advice on how best to challenge the information and get it corrected.

Check your credit file now