82% loan rejections in full-time employment

Freedom Finance reveals latest loan application results.

Related topics:  Specialist Lending
Millie Dyson
22nd February 2012
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Freedom Finance study reveals lack of education and growing need for credit leading to more and more people applying for inappropriate loan products and making debts and credit score worse  

Freedom Finance, the only loan comparison site where you can compare actual not typical or representative loan rates for personal, unsecured and secured loans without damaging your credit score today reveals the results of its latest loan applications data.

The research, which was compiled using data from users of the website, reveals an increase in loan rejections with 82% of those being turned down for a leading rate loan in full-time employment, a third (33%) having been in their current job for at least 10 years, 30% of those being rejected earning more than £30,000 a year and over half (55%) aged 40 or above.

The increase in rejections for leading rate loans has led to an increase in individuals turning to products not best suited to their individual borrowing needs. Once a customer has been turned down by a bank, credit card or low rate lender it seems that many are turning to payday loans or other products not suited to them to meet an increasingly desperate financial need.

Nicola Winter, MD, Freedom Finance says:

“Although pay-day loans that are responsibly offered and clearly and transparently  set out to borrowers do serve a specific short-term need they are not the best option for somebody that is looking for access to credit over the longer term.

"Many consumers are being rejected for headline rates with other lenders and are not aware that there is an entire spectrum of loan products available to them  that ‘soft search’ comparison sites (such as Freedom Finance) are able to help them find without then making the situation worse by damaging their credit rating.

"The reality is most people who apply will get declined for the leading rate loan and don’t know what to do from there.

“There is a need for consumer education here  as most consumer focussed financial sites talk about how to get the best rate and are not  making consumers aware of all the options available to them, in-between the leading rate and pay day loan products. Too many people are taking on inappropriate products through desperation when they actually qualify for a better product and better terms.

"Our research shows that these people are not sitting at home watching Jeremy Kyle they are working –earning good money and have been doing so for some time.

"It’s the middle classes not just the working classes that are feeling the pinch and not only need access to credit but need to be pointed in the direction of the right kind of product that does not exacerbate their already stretched financial situation. It is here where sites like ours can help.”
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