09 Mar 2015

A question about : Searches badly affected credit rating

Hi there

Until recently I had a 5/5 credit rating on Noddle, no idea about the other agencies but as I have no defaults on record and have a reasonable line of credit I imagine there were no problems.

I recently discovered a search by Tesco on my file and I have no idea what this relates to, as I've never applied for any Tesco banking-related products and hardly even shop there. It didn't seem to affect my ranking but now that I've had several searches due to moving house, the cumulative effect seems to be that my credit rating has dropped to 3/5 on Noddle solely due to searches. My bank was offering me a Ј25,000 loan that I was considering in order to buy some camera equipment, but that offer has now been reduced to Ј17,000 and the terms are not as good as previously.

How long is it likely to be before my credit rating recovers, and is it worth disputing the Tesco search?

Any help would be greatly appreciated.

Best answers:

  • What sort of search did Tesco do? Have you enquired about insurance with them in the past?
    When you say the bank reduced the offer and changed the terms - what exaclty happened? It seems unusual, outside of a mortgage, that they would accept you for a loan and then very quickly credit check you again and reduce it.
  • These are the details I have from my Noddle report regarding the Tesco search - I did note that it was an Associate Link Search but I didn't apply for anything during that period that would necessitate a search:
    Tesco Bank (Sr Sa Tac)
    Tesco Cards Api
    Checking Credit Application - (Associate Link Search) 25/11/2014
    Application type Sole
    With regards the loan, I made an application during summer last year and was offered Ј25,000, 60/mo terms at a reasonable rate, which I didn't take up due to a change in circumstances. In the meantime my Noddle rating dropped from 5/5 to 3/5 and when I reapplied last week the most they were willing to offer was Ј17,000 over 60/mo and with a slightly higher rate of interest. My account has been looked after well during that period and my income has increased, outgoings remained stable. Would a bank generally consider credit rating when offering a loan or just income and bank account management?
    I could shop around but I'm just concerned at how my financial circumstances have improved while my credit rating goes the other way!
  • No lender will look at a credit rating given by a CRA. They don't even see it.
    You might to keep an eye on your files in case there is anything untoward with that Tesco search.
  • "Associate Link Search"
    Does this not mean someone you have a financial agreement with has applied for something, and the lender has searched your file?
  • I'd look in the associate link search too. Sounds like someone you have a financial link to e.g. a joint account has recently been applying for Tesco credit products.
    Also the fact you've moved since your previous loan offer will adversely affect how lenders score you for credit in the short term, this combined with recent searches will result in lenders scoring you differently and in this case you've been offered a lower amount.
    Give it 6 months and things should be back to normal.
  • The search, as indicated above, was as a result of a financial partner applying for something. That does not have to be a wife/CP - it could be someone else to whom you are financially linked, maybe via a joint bank account.
    I doubt however that this has anything to do with the reduced loan offer
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