Unify Credit Union


Has your Credit File affected your chances of getting a loan?

Thursday 17th Oct, 2019

Why have I been refused a loan?

The first step is to find out why your loan application was not approved.

The most common reasons for being denied credit are:

1. Problems with your credit file

2. Not enough income (affordability) (Click HERE to read article about Affordability)




Bad (or no) credit: Unify looks at your borrowing history, usually in the form of your credit scores, when you apply for a loan. We want to see that you have a solid history of borrowing and repaying loans. However, you might not have borrowed much, or you might have experienced some challenges and actually defaulted on loans in the past. Either way, it’s harder to borrow without good credit.

Fix errors: if there are errors in your credit report, fix them. You shouldn’t be held responsible for computer errors or somebody else’s actions. You have the right to have mistakes removed.

Pay off other debts: your other loans could be part of the problem. Again, Unify looks at how much you spend on debt repayment, so reducing that expense will make you look better as a borrower. Of course, if you had extra money you might not need the loan.

Build your credit: borrowing will be easier in the future if you build a strong credit history. That means you’ll need to borrow (when it makes sense) and repay loans on time. Your credit will gradually improve, and you’ll get better interest rates – and fewer rejections – going forward. If you already have a loan with Unify, your regular repayments on your loan will also help improve your credit file. Remember missing payments or making irregular repayments can negatively affect your credit score.

Get caught up: if you’re behind on any of your loans, it’s time to get things cleaned up so that your credit can begin to heal. That doesn’t necessarily mean paying back 100% of what you owe, although that would be the best option. Contact your creditors and try to work out a payment plan, and get written agreement to remove negative information from your credit reports. If you have several creditors who you are not paying anything to at the moment, have a think about the total amount you can afford to repay and split that amount up in proportion to the amount of debt you owe each company.


Check your credit score online and for free at any or all of the following websites:

Before you Re-Apply

Save yourself some time and frustration before you apply for your next loan. Look at yourself the same way lenders do: are there any red flags in your credit, and do you have sufficient income to repay the loan?

Go through your credit report, and feel free to ask Unify if anything is going to be a problem – it’s going to come up anyway if you apply for a loan. We’ll gladly explain what matters and what doesn’t.

Please note that being refused a loan doesn’t mean that we can never give you a loan again. For many it may just mean not right now, many members will be able to continue to borrow from us, after they make some changes to their financial circumstances.



For more information visit our website http://unifycu.org/links.php where you will find links to advice and support

Unify Credit Union is Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority (FRN 213321)

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