Do i need a credit builder credit card ?
Discussion
Good Morning,
I dont need access to any credit at the moment but i would like to be able to upgrade to a decent family car next year and a bank loan would help me get into something nicer rather than just using the capital i have.
I checked my credit score which isnt bad, i have no defaults ccjs. I work in debt collection so understand how to use credit and the impact of defaults etc. It says on my credit file that a credit building credit card may help me boost my rating.
I currently have a joint mortgage with a relatively large sum £180,000 left but have never missed a payment or deferred any payments, I have a small loan that i pay each month and could clear if needed to, balance of £2500. I have a mobile phone gym membership all the usual bits. I dont need or want a credit card but want to work towards boosting my score so i have access to better interest rates next year.
What would you do if you were me and looking to boost your score ? Its not a poor score at all, but i would like to acheive a top score. I understand taking on the mortgage 3 years ago would have had an impact and it did drop a little afterwards.
Alternitavely i can continue to save, but i dont feel comfortable using a fair chunk of my savings to fund a vehicle next year.
I dont need access to any credit at the moment but i would like to be able to upgrade to a decent family car next year and a bank loan would help me get into something nicer rather than just using the capital i have.
I checked my credit score which isnt bad, i have no defaults ccjs. I work in debt collection so understand how to use credit and the impact of defaults etc. It says on my credit file that a credit building credit card may help me boost my rating.
I currently have a joint mortgage with a relatively large sum £180,000 left but have never missed a payment or deferred any payments, I have a small loan that i pay each month and could clear if needed to, balance of £2500. I have a mobile phone gym membership all the usual bits. I dont need or want a credit card but want to work towards boosting my score so i have access to better interest rates next year.
What would you do if you were me and looking to boost your score ? Its not a poor score at all, but i would like to acheive a top score. I understand taking on the mortgage 3 years ago would have had an impact and it did drop a little afterwards.
Alternitavely i can continue to save, but i dont feel comfortable using a fair chunk of my savings to fund a vehicle next year.
I doubt you need to build your credit history for a loan, you seem to have plenty of history. Mortgage etc.
Have you tried doing a soft search for what your after?
https://www.moneysavingexpert.com/eligibility/cred...
It wont harm your credit file until you actually apply.
Have you tried doing a soft search for what your after?
https://www.moneysavingexpert.com/eligibility/cred...
It wont harm your credit file until you actually apply.
Benbay001 said:
I doubt you need to build your credit history for a loan, you seem to have plenty of history. Mortgage etc.
Have you tried doing a soft search for what your after?
https://www.moneysavingexpert.com/eligibility/cred...
It wont harm your credit file until you actually apply.
I have done yes and it was giving me access to better credit providers and rates last month than it is this month. Nothing about my circumstances outgoings has changed, could it be due to the current situation ? Have you tried doing a soft search for what your after?
https://www.moneysavingexpert.com/eligibility/cred...
It wont harm your credit file until you actually apply.
I think the actual scores you get given are a made up number in the main, I do use clearscore myself but the number can seem to fluctuate for no reason at all, my credit levels are good in that I have a fairly modest mortgage, one credit card I clear monthly and never have more than a couple of hundred on it balance anyway and no other loans currently, I have a broadband contract at home and my phone is on Giffgaff which is basically PAYG. I have had no issues getting personal loans at the best rates from main providers in the past when I have applied.
I think the main criteria are the bank or lender can see you are not missing payments and are not overcommitted, I think as you have a mortgage and I assume maintaining it with no issues you will be fine, I doubt a Credit Card will make much difference either way.
I think the main criteria are the bank or lender can see you are not missing payments and are not overcommitted, I think as you have a mortgage and I assume maintaining it with no issues you will be fine, I doubt a Credit Card will make much difference either way.
Why do you want to boost your score, I can't see the point unless it is preventing you from getting the loan you want.
I did a check on clear score recently out of interest to see what my score was. I have not had a loan for 17 years, never missed a payment on anything in my life, one credit card with a high limit but zero balance, on the electoral register, decent salary, no other monthly agreements apart from a £19.50 mobile phone. Mid five figures amount in a Marcus account.
My score is 461 out of 700. On my report everything is green and on track.
Personally I think it is a load of old nonsense to try and convince you that your credit score is poor but could be improved if you take out the finance products recommended by clear score.
I did a check on clear score recently out of interest to see what my score was. I have not had a loan for 17 years, never missed a payment on anything in my life, one credit card with a high limit but zero balance, on the electoral register, decent salary, no other monthly agreements apart from a £19.50 mobile phone. Mid five figures amount in a Marcus account.
My score is 461 out of 700. On my report everything is green and on track.
Personally I think it is a load of old nonsense to try and convince you that your credit score is poor but could be improved if you take out the finance products recommended by clear score.
Joey Deacon said:
Why do you want to boost your score, I can't see the point unless it is preventing you from getting the loan you want.
I did a check on clear score recently out of interest to see what my score was. I have not had a loan for 17 years, never missed a payment on anything in my life, one credit card with a high limit but zero balance, on the electoral register, decent salary, no other monthly agreements apart from a £19.50 mobile phone. Mid five figures amount in a Marcus account.
My score is 461 out of 700. On my report everything is green and on track.
Personally I think it is a load of old nonsense to try and convince you that your credit score is poor but could be improved if you take out the finance products recommended by clear score.
Yes and no.I did a check on clear score recently out of interest to see what my score was. I have not had a loan for 17 years, never missed a payment on anything in my life, one credit card with a high limit but zero balance, on the electoral register, decent salary, no other monthly agreements apart from a £19.50 mobile phone. Mid five figures amount in a Marcus account.
My score is 461 out of 700. On my report everything is green and on track.
Personally I think it is a load of old nonsense to try and convince you that your credit score is poor but could be improved if you take out the finance products recommended by clear score.
Your score is low because of all the reasons you've stated above...........no loan for 17 years.........zero balance on your credit card........no other monthly agreements......
But yes, the whole credit referencing industry is based on inducing paranoia in people so that they pay for their service or take out products they tell you that you are eligible for, conveniently from their associated business partners.
OP, you have a mortgage...............make sure you are on the electoral roll...............don't miss any payments......thats all you need to do.
Yes i agree r.e it being a load of nonsense, my score shows it is 604 out of 710 but the eligibility checker for loans is giving me less favourable rates . Thre reason for wanting to 'boost' my score is why would i want to pay 6-7% in interest when i could potentially get 3% ?
I think best to continue managing my finances they way i am and check again next year if theres any improvement. Maybe commit more of my own capital toward the car purchase.
I think best to continue managing my finances they way i am and check again next year if theres any improvement. Maybe commit more of my own capital toward the car purchase.
Jcwjosh said:
Yes i agree r.e it being a load of nonsense, my score shows it is 604 out of 710 but the eligibility checker for loans is giving me less favourable rates . Thre reason for wanting to 'boost' my score is why would i want to pay 6-7% in interest when i could potentially get 3% ?
I think best to continue managing my finances they way i am and check again next year if theres any improvement. Maybe commit more of my own capital toward the car purchase.
There must be another reason for this, I can only assume it is because of the amount of money you have remaining after meeting your monthly commitments?I think best to continue managing my finances they way i am and check again next year if theres any improvement. Maybe commit more of my own capital toward the car purchase.
If you paid off the £2,500 would this improve your eligibility as on paper you would have less monthly commitments?
I wouldn't worry about the score personally.
I do think though that having a regular credit card(s) to use is generally a good thing for other reasons. I have several to hand and we put our entire spending through the credit cards. We spend something on a debit card maybe 5 times a year!
For me, the benefits of a cc are (in no particular order):
a) you get mileage / points / cash back on everything you spend.
b) you get 40 days interest free on everything you spend.
d) if I ever am "stuck", I have near instant access to cash. I wouldn't travel abroad without 2 just in case.
e) the online protection
f) extra card holder for the mrs
g) work expenses
h) makes it simpler to manage monthly spending - Everything we spend is on the cc, one payment comes out of my current a/c per month automatically.
All of this assumes that you use it for regular spending and pay it off in full each month. With this approach, I don't understand why everyone would not do this. It's essentially free.
I do think though that having a regular credit card(s) to use is generally a good thing for other reasons. I have several to hand and we put our entire spending through the credit cards. We spend something on a debit card maybe 5 times a year!
For me, the benefits of a cc are (in no particular order):
a) you get mileage / points / cash back on everything you spend.
b) you get 40 days interest free on everything you spend.
d) if I ever am "stuck", I have near instant access to cash. I wouldn't travel abroad without 2 just in case.
e) the online protection
f) extra card holder for the mrs
g) work expenses
h) makes it simpler to manage monthly spending - Everything we spend is on the cc, one payment comes out of my current a/c per month automatically.
All of this assumes that you use it for regular spending and pay it off in full each month. With this approach, I don't understand why everyone would not do this. It's essentially free.
Joey Deacon said:
There must be another reason for this, I can only assume it is because of the amount of money you have remaining after meeting your monthly commitments?
If you paid off the £2,500 would this improve your eligibility as on paper you would have less monthly commitments?
This is my thinking also, aside from the mortgage and my small loan my other outgoings are fairly minimal. I am toying with the idea of settling the loan early and then that gives me 6-7 months where i can see if not having that outgoing makes any difference.If you paid off the £2,500 would this improve your eligibility as on paper you would have less monthly commitments?
Jcwjosh said:
Yes i agree r.e it being a load of nonsense, my score shows it is 604 out of 710 but the eligibility checker for loans is giving me less favourable rates . Thre reason for wanting to 'boost' my score is why would i want to pay 6-7% in interest when i could potentially get 3% ?
I think best to continue managing my finances they way i am and check again next year if theres any improvement. Maybe commit more of my own capital toward the car purchase.
You don't say in your original post how much you are looking to loan? The only reason I ask is that if for example you are looking for a low value loan (under 5k for example) you will not usually get the best or advertised rates, many loan companies don't offer their best rates until you are looking at circa £7000 plus. It may be you don't want to loan that much but it may be beneficial for you to loan a higher amount if you can then pay back an excess quickly as a one off payment. I think best to continue managing my finances they way i am and check again next year if theres any improvement. Maybe commit more of my own capital toward the car purchase.
fat80b said:
I wouldn't worry about the score personally.
I do think though that having a regular credit card(s) to use is generally a good thing for other reasons. I have several to hand and we put our entire spending through the credit cards. We spend something on a debit card maybe 5 times a year!
For me, the benefits of a cc are (in no particular order):
a) you get mileage / points / cash back on everything you spend.
b) you get 40 days interest free on everything you spend.
d) if I ever am "stuck", I have near instant access to cash. I wouldn't travel abroad without 2 just in case.
e) the online protection
f) extra card holder for the mrs
g) work expenses
h) makes it simpler to manage monthly spending - Everything we spend is on the cc, one payment comes out of my current a/c per month automatically.
All of this assumes that you use it for regular spending and pay it off in full each month. With this approach, I don't understand why everyone would not do this. It's essentially free.
I can definately see the benefits of using a credit card, mainly the protection it offers you on purchases. I am tempted to apply for one book a holiday and then pay it off over the 0% interest period but dont want to damage my rating .I do think though that having a regular credit card(s) to use is generally a good thing for other reasons. I have several to hand and we put our entire spending through the credit cards. We spend something on a debit card maybe 5 times a year!
For me, the benefits of a cc are (in no particular order):
a) you get mileage / points / cash back on everything you spend.
b) you get 40 days interest free on everything you spend.
d) if I ever am "stuck", I have near instant access to cash. I wouldn't travel abroad without 2 just in case.
e) the online protection
f) extra card holder for the mrs
g) work expenses
h) makes it simpler to manage monthly spending - Everything we spend is on the cc, one payment comes out of my current a/c per month automatically.
All of this assumes that you use it for regular spending and pay it off in full each month. With this approach, I don't understand why everyone would not do this. It's essentially free.
Jcwjosh said:
I can definately see the benefits of using a credit card, mainly the protection it offers you on purchases. I am tempted to apply for one book a holiday and then pay it off over the 0% interest period but dont want to damage my rating .
That is the only reason I have held on to mine, the protection when purchasing things online. Also having had my debit card cloned in the past I would rather any future fraudsters spend the credit card companies money than the money in my bank account.It is also handy when hiring a car as they will usually want to pre authorise a credit card when you collect the car.
Finally if the worst comes to the worst I can borrow money on my card at 0% over 12 months with a 4% fee, or 4.9 pa over 48 months instantly.
Interestingly enough these rates and duration are nowhere near as good as they were a year or so ago.
I've never checked my credit score and never really understood the need to do so.
I'm guessing it must be ok because I've never been refused a loan and always managed to get the lowest advertised rate,
I'm also not sure how certain things affect it, I thought having a mortgage made a big difference but I've been mortgage free for years and still never had any issues,
If i want a loan for something I just see who's offering the best rate, then apply and see what happens,
If the answer is "computer says no" or they offer me a worse rate than advertised I'd just say no thanks and do without
Joey Deacon said:
Jcwjosh said:
I can definately see the benefits of using a credit card, mainly the protection it offers you on purchases. I am tempted to apply for one book a holiday and then pay it off over the 0% interest period but dont want to damage my rating .
That is the only reason I have held on to mine, the protection when purchasing things online. Also having had my debit card cloned in the past I would rather any future fraudsters spend the credit card companies money than the money in my bank account.It is also handy when hiring a car as they will usually want to pre authorise a credit card when you collect the car.
- most of my foreign holiday spend and purchases onto CC as they are commission free with a competitive e/rate i.e. No need to exchange a large sum of cash for holiday. However, I tend to withdraw from ATM £200 in local currency to cover the incidental expenses.
- cash rebate. Only 0.5% from Nationwide, but it pays for a decent lunch at the end of the year.
I've not managed to make sense of the credit scoring done by Clearscore.
My sister has been signed up with them for a few years, and convinced me to give it a go. Was a bit surprised that my "score" was lower than hers.
I am mortgage-free, house worth about £280k
I own 2 cars, no repayments.
I have £30k in savings.
I always pay my credit card bills in full every month (I have at least 4 cards, 2 of which are used regularly)
I have 3 current accounts, all in credit.
I had a personal loan (£10k) for a car, paid off 2 years ago. Made more sense than spending my savings.
I've never defaulted or been late with a payment for anything.
I haven't had an overdraft since I was 18 (45 years ago).
The only thing that might go against me is that the majority of my income comes from self-employment, although my company pensions cover all the bills.
My sister has 3 kids at home, lives in a rented house, has over £10k of debts, no savings.
She has a decent job though (roughly the same income as me, but easier to "prove" as it's PAYE), and is slowly clearing her debts.
Makes no sense that she has a better score than me, so I'm guessing it's just a marketing tool to flog financial products.
My sister has been signed up with them for a few years, and convinced me to give it a go. Was a bit surprised that my "score" was lower than hers.
I am mortgage-free, house worth about £280k
I own 2 cars, no repayments.
I have £30k in savings.
I always pay my credit card bills in full every month (I have at least 4 cards, 2 of which are used regularly)
I have 3 current accounts, all in credit.
I had a personal loan (£10k) for a car, paid off 2 years ago. Made more sense than spending my savings.
I've never defaulted or been late with a payment for anything.
I haven't had an overdraft since I was 18 (45 years ago).
The only thing that might go against me is that the majority of my income comes from self-employment, although my company pensions cover all the bills.
My sister has 3 kids at home, lives in a rented house, has over £10k of debts, no savings.
She has a decent job though (roughly the same income as me, but easier to "prove" as it's PAYE), and is slowly clearing her debts.
Makes no sense that she has a better score than me, so I'm guessing it's just a marketing tool to flog financial products.
Jcwjosh said:
fat80b said:
I wouldn't worry about the score personally.
I do think though that having a regular credit card(s) to use is generally a good thing for other reasons. I have several to hand and we put our entire spending through the credit cards. We spend something on a debit card maybe 5 times a year!
For me, the benefits of a cc are (in no particular order):
a) you get mileage / points / cash back on everything you spend.
b) you get 40 days interest free on everything you spend.
d) if I ever am "stuck", I have near instant access to cash. I wouldn't travel abroad without 2 just in case.
e) the online protection
f) extra card holder for the mrs
g) work expenses
h) makes it simpler to manage monthly spending - Everything we spend is on the cc, one payment comes out of my current a/c per month automatically.
All of this assumes that you use it for regular spending and pay it off in full each month. With this approach, I don't understand why everyone would not do this. It's essentially free.
I can definately see the benefits of using a credit card, mainly the protection it offers you on purchases. I am tempted to apply for one book a holiday and then pay it off over the 0% interest period but dont want to damage my rating .I do think though that having a regular credit card(s) to use is generally a good thing for other reasons. I have several to hand and we put our entire spending through the credit cards. We spend something on a debit card maybe 5 times a year!
For me, the benefits of a cc are (in no particular order):
a) you get mileage / points / cash back on everything you spend.
b) you get 40 days interest free on everything you spend.
d) if I ever am "stuck", I have near instant access to cash. I wouldn't travel abroad without 2 just in case.
e) the online protection
f) extra card holder for the mrs
g) work expenses
h) makes it simpler to manage monthly spending - Everything we spend is on the cc, one payment comes out of my current a/c per month automatically.
All of this assumes that you use it for regular spending and pay it off in full each month. With this approach, I don't understand why everyone would not do this. It's essentially free.
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