Cannot get approved for any credit at all despite good score and no ccjs etc, frustrating

[Iamsocold888]

I had a debt repayment plan almost a year ago as I had around £7000 debts, but I received a family inheritance and paid the vast majority of it off, so was only using the plan for around 2 months.
I have around £130 of loan debt but nothing else, no overdraft, no cards etc and I use a credit boosting app

I’m on the electoral register

Haven’t had any missed payments for quite a few months

However I cannot even get approved for klarna due to my credit history. I’m not trying to take out a card or a loan otherwise, I just want to split the cost of something on klarna.

Out of interest i searched my loan eligibility and I wasn’t eligible for anything. It’s frustrating as my credit score is ‘good’ on Experian now, used to be very poor a year ago.

I am on track and save money each month, next to no debt. I’m not sure why I am rejected for everything as it’s been 6 months since the debt management plan finished too, is it going to take years until I can access anything ?

Also never had a CCJ, IVA etc and I work full time, I just feel embarrassed really about my situation

I've seen advice on this sort of thing before to be to apply for a credit card and then manage it responsibly for a while so you build up an actual credit history. No idea if it would work.

Did you default on any of your debts? A paid default will bring your score up, but having a default (or multiple) in the first place will exclude you from most lenders.

It doesn’t seem like I am even approved for a credit card, even the ones designed for poor credit.
I don’t really understand it, I had an informal plan as opposed to a legally binding one, I’ve now paid it all off and have next to no debt, and a good score yet it’s impossible for me

No I didn’t default, I was close to defaulting on them and received notices to default if I didn’t pay by x date, but when I received the family money I paid off everything in time

You are very unlikely to get credit until the debt issue drops off your credit file on 6 years time. You may, a little further down the line, get a credit rebuilding credit card but I think you'll have a wait.

If you keep applying for things despite being turned down it's bug red flags for banks.

Leave it for 6 months
Pay off all debts

And try again in 6 months, and do a soft search first!

6 years

Haven’t had any missed payments for quite a few months

Maybe it's this then?

It doesn’t seem like I am even approved for a credit card, even the ones designed for poor credit.

You can't know unless you apply - why not try applying for a card with your bank first? The you can ask them why they turned you down if they do.

Yes you’re right about the applications, I have only done soft searches to check my eligibility and klarna was the only thing I did an application for.

If you keep applying for things despite being turned down it's bug red flags for banks.
Good point - OP what else have you actually applied for in addition to Klarna?

You say you haven't had missed payments in a few months, how many missed payments have you had in total?

I have a mortgage, credit card and two loans. My score is 999 because I don't miss payments. I think the missed payments is your issue.

Have you signed up with Experian? They and other similar services (e.g Equifax or credit karma) often have soft searching options that can check your eligibility for cards so that you're only applying for ones you should be eligible for. A credit builder card with a good payment history is the surest way to build up your score.
A default payment will take six years to disappear but will have less impact after six months/a year. Lots of good advice on MSE and Which pages on improving your credit score, including checking for mistakes in your history.

Your credit score doesn’t matter; in terms of the “good” or “poor” ratings, because each credit provider rates things differently and has different categorisations. Experian give you an “illustration” but they don’t even offer credit.

You need to look at your report, and all three of them - Experian, Equifax and Transunion, as different institutions will use different ones.

It’s likely that your report will at least show late or missed payments from last year, if not defaults or an arrangement to pay, and that’ll be too recent for many places like Klarna to offer credit.

Repeatedly applying for credit will impact on your file too, so you want to avoid that… really all you can do is either look at credit rebuilding cards, which will have horrendous API so you want to be able to pay them off in full really, or wait until the bad history is a lot less recent. It’ll stay on your file for six years but it’ll be less relevant in a few years.

Sorry, I am a credit manager and I wouldn't touch you with a barge pole at the moment, you need to rebuild your profile.

Save for what you want instead of using Klarna. That would to scream to me that you still use credit as a prop.

What you did is essentially a voluntary informally agreed IVA. It will effect your for 6 years. Make sure your credit files (there are 3 to address Transunion, experian and equifax) show that all the cleared debts are cleared. You said you still have debts outstanding so until these are paid they will continue to effect you if you also had missed payments etc on those debts. Concentrate on getting everything clear and getting your credit score improved and in the mean time only buy what you can afford without credit or klarna etc.

Continuing Applications will not help either, searches themselves show up on the credit file, so searches and declined for credit is a negative in itself.

In addition to look at your own finances see if you can find anything relating to your Address. Or someone other than you with your name.

It's not unknown for either of these to affect your credit situation.

May be sit down face to face with a credit advisor/bank. Or look into a Credit Union Savings Account to get you some actual credit record.

However, as someone has already mentioned it may just be a time thing.

Can you get a capital one card with a tiny £200 limit?

I haven’t formally applied for anything except klarna, just soft searches.

That’s a good idea, I’m going to check my report now

I think my last missed payment was in March of last year, I had around 3/4 late payments as I was starting the plan then

@TakeYourFinalPosition

Your credit score doesn’t matter; in terms of the “good” or “poor” ratings, because each credit provider rates things differently and has different categorisations. Experian give you an “illustration” but they don’t even offer credit.

You need to look at your report, and all three of them - Experian, Equifax and Transunion, as different institutions will use different ones.

It’s likely that your report will at least show late or missed payments from last year, if not defaults or an arrangement to pay, and that’ll be too recent for many places like Klarna to offer credit.

Repeatedly applying for credit will impact on your file too, so you want to avoid that… really all you can do is either look at credit rebuilding cards, which will have horrendous API so you want to be able to pay them off in full really, or wait until the bad history is a lot less recent. It’ll stay on your file for six years but it’ll be less relevant in a few years.

I should have just quoted this haha basically cross posted. OP visit the money saving expert forum for more expert advice too they have fantastic support on there too.

Why are you trying to split the cost of something using Klarna when you’ve been in debt trouble, close to defaulting? You need to learn to manage your money better instead of relying on more credit

@Iamsocold888

I haven’t formally applied for anything except klarna, just soft searches.

That’s a good idea, I’m going to check my report now

I think my last missed payment was in March of last year, I had around 3/4 late payments as I was starting the plan then

You need to clear and close the debts that had missed payments. These need to show as closed accounts on your credit report and the 6 years starts from those dates. After a year or so you'll probably be eligible for a "poor credit" credit card which (of used responsibly and cleared in full each month) will boost your score over time. You're in the for the long haul now there is no quick fix.

*if used responsibly

I can tell you from experience (my DRP very similar to yours) that it is 6 years from when you paid it off.

Don't mean to depress you but that includes getting a mortgage and can even stop you porting an existing mortgage to a new property.

The other bad news (and so didn't feel clear on any of this either until it was too late) is that if you are married, it also affects your spouse.

All round, very shit indeed.