Is there a credit blacklist which lenders check?
A popular misconception is by having a poor credit history you are forever banished from being able to get a loan or other form of credit in the future. Many wrongly believe that your particulars are added to a credit blacklist to ensure you will be denied.
Many applications for loans are rejected because the applicant does not meet the criteria defined by the lender. When you apply for a loan, the lender will determine how close you are to being their ‘ideal applicant’. If you meet the criteria they’re looking for, you’ll be accepted. If you don’t, you'll get rejected – simple as that.
One of most popular myths
However, there is no central blacklist of individuals with bad credit scores which lenders use as the basis of determining who they will lend to. The concept of a credit blacklist is one of the most common myths in the world of personal finance. The truth is there is no such thing as a credit blacklist. Being refused credit by one lender, doesn’t necessarily mean you will be refused by another. Each lender will have their own wish list as to what makes a perfect customer, and this will vary from lender to lender. Although lenders do share information through individual's credit reports, each lender will examine the information on your credit report and assess you independently.
Target your application wisely
There are some loan lenders who will only accept those with unsullied credit history. For instance, the personal loan products which come with the lowest rates of interest tend to be accessible only to the highest calibre of applicants – those with highest credit scores. So if you know your credit history is defective and choose to apply for the products listed at the top of the best deal tables, you're likely to be disappointed with the outcome. Embarking upon this course of action is likely to lead to rejection and could harm your chances even further as each application you make will leave a footprint on your credit file. A number of applications in a short space of time often makes lenders wary as this is often interpreted as indication of financial difficulties.
If you’ve had financial problems in the past, rather than a fruitless haphazard approach, you may be better to carefully select which loans to apply for and target specialist lenders who are actively looking for customers with impaired credit history. You can use the search facility above to get an indication as to what is available.