One in 20 people have been turned down for credit in the past 18 months, according to a recent survey by GE Money Home Lending.
The study found that as lenders have continued to tighten their criteria for loans and mortgages roughly five per cent of applicants have been declined since the beginning of 2007.
Results also showed the number of attempts people had tried unsuccessfully before securing credit. 13 per cent of those questioned had made at least four attempts, with a further one per cent saying they had needed to apply over eight times before successfully landing a mortgage or loan.
Nearly a third of people gave up after the first rejection, but a further 12 per cent went on to make multiple applications without success.
GE said many consumers were finding it harder to get their hands on the credit they needed, as tighter lending criteria had placed many consumers as a higher risk than before.
Owen Roberts, from credit reference agency CallCredit, said that it is increasingly the middle income, middle classes that are making multiple applications for credit.
“What happens is they are rejected and can’t believe it so apply again and again, but have no idea how damaging repeated applications are for their credit records in the short term.
“It’s just not a good idea to take a scattergun approach to credit applications.”
Chiltern’s Nathan Gladwell says: “Before trying to secure a mortgage or loan, it’s useful to check your credit record to make sure there aren’t any errors, or to see if you need to cancel the half-dozen credit cards lying unused in the bottom of your drawer.
“It’s free to view and can be done simply by going to the Chiltern website money saving section, where you can see your credit report. This could be the difference between a yes and being declined, which could further impair your record.”