One thing we know is rising costs will impact everyone, especially in the upcoming winter. The Costs of Living Crisis is very much the new status quo.
Some will look to obtain credit to help as a quick fix, but will this option be available?
Glenside Finance along with many other firms prioritise affordability checks to decide whether to offer finance. This is because a credit score, whilst important, gives a snapshot of your historical use of credit. It doesn’t give a complete picture of your finances such as spending on non-credit items like rent, food and utilities. It also doesn’t consider what is happening to prices in the wider world. It’s easy to simply think about today, the present and not what will occur in six months’ time.
A responsible lender will always carry out affordability checks before approving a credit limit. How this is done can vary by lender and even by application. At Glenside Finance, we will usually request at least 3 months bank statements to understand everyone’s current situation, income, and expenditure. Further documents may be required depending on occupation / employment status. This is to ensure the timing is right for you and not something that will increase any outstanding commitments which could result in debt, especially in the current climate.
Affordability Checks – Some of many points we look at:
- How much is the consumer earning?
- Is that income stable?
- Is it keeping up with increased spending due to inflation?
- How are expenses broken down? What level is fixed (like rent/utilities) and what level is discretionary (like social spend)?
Inflation is structured within our approach to customise declared expenses based on spend on items expected to increase like utilities.
Whether or not repayments can be affordable will very much depend on your circumstances. As a starting point if you would like to look at potential repayments to see if they would fit into your budget, this is something you do on our finance calculator.
Again, finance calculators are a great place for you to start and will give some idea of potential repayments. However you will never know for certain if you can get the loan you require without applying. You will need to go through the necessary affordability checks, as well as other checks before anything can be guaranteed.
If this is something you would like to look into and you want us to consider lending you vehicle finance, then you can apply here.
If you need any more information you are always free to call us on 01942 466035, option 2.
For further reading about the costs of living crisis, please look at one of our previous blogs:
The Cost of Living in the UK is Rising
The Cost of Living has Risen
