Discussion
thankfully not needing to be concerned by them thus far, i out of curiosity when opening a new current account to take advantage of a savings account linked to it, and picking up on the warning of may impact credit rating temporarily due to credit/ KYC checks, or some such stuff, signed up to experian and was pleased to see a 999 rating (wow look at me....)....anyway after opening 4 new current accounts in october simply to utilise various associated and dependent savings accounts, i checked experian and had dropped to a yellow score in mid 800's.
doesnt impact me currently or short/medium term, but checked again today and still yellow, due to those 4 accounts i opened and the checks run. which is the only negative impacter (other than having no mortgage (which shows as medium risk but assumedly has no impact as i was 999 before the accounts i opened).
im not sure why as they are no overdraft debit accounts, not credit...the guff on experian suggests opening multiple accounts can infer you are dependent on credit, yet i don't understand that, given their not credit accounts....anyway i aslo understand the checks on me to open the accounts themselves impact as well, although again im baffled why this impacts a credit score when its nothing to do with 'credit'.
i know you can challenge and correct but it seems these are correct but i dont understand what they have to do with credit.
my question is how long will these take to drop off? assuming they eventually will?
i wish to open a chetwood account, but again this will negatively impact my score based on precedent. as i say it has no short/medium impact as i have no credit/borrowing plans, touch wood. but at some point in a few years i may.
can the kind folk educate me on how these work as seems a bit odd opening debit accounts impact a notional borrowing score.
doesnt impact me currently or short/medium term, but checked again today and still yellow, due to those 4 accounts i opened and the checks run. which is the only negative impacter (other than having no mortgage (which shows as medium risk but assumedly has no impact as i was 999 before the accounts i opened).
im not sure why as they are no overdraft debit accounts, not credit...the guff on experian suggests opening multiple accounts can infer you are dependent on credit, yet i don't understand that, given their not credit accounts....anyway i aslo understand the checks on me to open the accounts themselves impact as well, although again im baffled why this impacts a credit score when its nothing to do with 'credit'.
i know you can challenge and correct but it seems these are correct but i dont understand what they have to do with credit.
my question is how long will these take to drop off? assuming they eventually will?
i wish to open a chetwood account, but again this will negatively impact my score based on precedent. as i say it has no short/medium impact as i have no credit/borrowing plans, touch wood. but at some point in a few years i may.
can the kind folk educate me on how these work as seems a bit odd opening debit accounts impact a notional borrowing score.
If you don't need credit, you don't even need to concern yourself with your "score".
The "score" is simply an algorithmic number generated by what they (credit reference agencies) think are important to the businesses that lend people money.
A high score does not mean you will be accepted for credit.
A low score does not mean that you will be declined.
Lenders have their own internal score card and will make their own assessment of your circumstances, independent of whatever your "score" may be.
Your score will recover in time as the searches become more historic.
Everything on your credit file remains on there for 6 years.
The "score" is simply an algorithmic number generated by what they (credit reference agencies) think are important to the businesses that lend people money.
A high score does not mean you will be accepted for credit.
A low score does not mean that you will be declined.
Lenders have their own internal score card and will make their own assessment of your circumstances, independent of whatever your "score" may be.
Your score will recover in time as the searches become more historic.
Everything on your credit file remains on there for 6 years.
Sarnie said:
If you don't need credit, you don't even need to concern yourself with your "score".
The "score" is simply an algorithmic number generated by what they (credit reference agencies) think are important to the businesses that lend people money.
A high score does not mean you will be accepted for credit.
A low score does not mean that you will be declined.
Lenders have their own internal score card and will make their own assessment of your circumstances, independent of whatever your "score" may be.
Your score will recover in time as the searches become more historic.
Everything on your credit file remains on there for 6 years.
yes i appreciate that but was more curious to the logic and why a current a/c with no OD facility impacts a credit score and indicates a prepensity to need credit.The "score" is simply an algorithmic number generated by what they (credit reference agencies) think are important to the businesses that lend people money.
A high score does not mean you will be accepted for credit.
A low score does not mean that you will be declined.
Lenders have their own internal score card and will make their own assessment of your circumstances, independent of whatever your "score" may be.
Your score will recover in time as the searches become more historic.
Everything on your credit file remains on there for 6 years.
theplayingmantis said:
yes i appreciate that but was more curious to the logic and why a current a/c with no OD facility impacts a credit score and indicates a prepensity to need credit.
It's all down to a "computer says no" style situation.It's a basic rules based system and change isn't seen as a positive.
As an example
A couple of years ago we went through the process of guaranteeing a lease for our son and his mate
The system rejected us and when we asked why they looked into it and it was because we don't pay rent or have a mortgage, so the system couldn't provide the tick they required.
As soon as someone looked it was approved
In some circumstances a high score can actually reduce your chances of getting credit…
Years ago we were looking to buy some furniture that was available with a buy now, pay later deal - Interest free for 12 months but something like 30% APR on any balance outstanding at the end of the term.
I was declined, apparently because they targeted people with poor credit scores who were unlikely to pay the loan off during the interest free period. (I have no proof of this, just what the sales guy told me when I paid cash instead)
Years ago we were looking to buy some furniture that was available with a buy now, pay later deal - Interest free for 12 months but something like 30% APR on any balance outstanding at the end of the term.
I was declined, apparently because they targeted people with poor credit scores who were unlikely to pay the loan off during the interest free period. (I have no proof of this, just what the sales guy told me when I paid cash instead)
theplayingmantis said:
yes i appreciate that but was more curious to the logic and why a current a/c with no OD facility impacts a credit score and indicates a prepensity to need credit.
You're potentially overdrawn to the max on any number of other current accounts, your salary is getting swallowed up as soon as it goies in so you open a new account to protect it?Probably because opening 4 new current accounts in a month looks a bit dodgy?
I'd hazard a guess that most people only have one or maybe two current accounts.
Maybe you have legitimate reasons. Maybe you're just opening them for the free money on offer. Or maybe you fancy doing a bit of fraud.
Once opened, what's to stop you asking each one for an overdraft. Bank A isn't going to check with banks B,C,D to check you haven't got huge unpayable overdrafts with them and vice-versa.
Just because you haven't got credit with these accounts, doesn't stop you trying to get credit elsewhere with a credit card or mortgage.
As I understand it, your credit rating is just used as a guide by financial companies as just one thing to look into when dealing with you. They also use multiple agencies.
Having no credit can be a negative as well because you have no "history" so there is no way of knowing if you are a good payer or are just going to run off with a load of cash. It's like you lending £50 to your mate Bob who you've known for 20 years - you know where he lives and he paid you back last time. On the other hand if you lend £50 to some chap you've just met in the pub, you're at great risk of not seeing that money again
I'd hazard a guess that most people only have one or maybe two current accounts.
Maybe you have legitimate reasons. Maybe you're just opening them for the free money on offer. Or maybe you fancy doing a bit of fraud.
Once opened, what's to stop you asking each one for an overdraft. Bank A isn't going to check with banks B,C,D to check you haven't got huge unpayable overdrafts with them and vice-versa.
Just because you haven't got credit with these accounts, doesn't stop you trying to get credit elsewhere with a credit card or mortgage.
As I understand it, your credit rating is just used as a guide by financial companies as just one thing to look into when dealing with you. They also use multiple agencies.
Having no credit can be a negative as well because you have no "history" so there is no way of knowing if you are a good payer or are just going to run off with a load of cash. It's like you lending £50 to your mate Bob who you've known for 20 years - you know where he lives and he paid you back last time. On the other hand if you lend £50 to some chap you've just met in the pub, you're at great risk of not seeing that money again
AngryYorkshireman said:
Probably because opening 4 new current accounts in a month looks a bit dodgy?
Quite normal. Every newly opened barbers shop, requires several business current accounts. There is a limit on how much cash (call it 'business takings') can be paid in each week to any one bank. They might snoop on the number of barbers chairs, trying to work out what is going on.
In that 'line of business', the last thing needed is a loan, so a credit score is irrelevant.
theplayingmantis said:
Sarnie said:
If you don't need credit, you don't even need to concern yourself with your "score".
The "score" is simply an algorithmic number generated by what they (credit reference agencies) think are important to the businesses that lend people money.
A high score does not mean you will be accepted for credit.
A low score does not mean that you will be declined.
Lenders have their own internal score card and will make their own assessment of your circumstances, independent of whatever your "score" may be.
Your score will recover in time as the searches become more historic.
Everything on your credit file remains on there for 6 years.
yes i appreciate that but was more curious to the logic and why a current a/c with no OD facility impacts a credit score and indicates a prepensity to need credit.The "score" is simply an algorithmic number generated by what they (credit reference agencies) think are important to the businesses that lend people money.
A high score does not mean you will be accepted for credit.
A low score does not mean that you will be declined.
Lenders have their own internal score card and will make their own assessment of your circumstances, independent of whatever your "score" may be.
Your score will recover in time as the searches become more historic.
Everything on your credit file remains on there for 6 years.
AngryYorkshireman said:
Probably because opening 4 new current accounts in a month looks a bit dodgy?
I'd hazard a guess that most people only have one or maybe two current accounts.
Maybe you have legitimate reasons. Maybe you're just opening them for the free money on offer. Or maybe you fancy doing a bit of fraud.
Once opened, what's to stop you asking each one for an overdraft. Bank A isn't going to check with banks B,C,D to check you haven't got huge unpayable overdrafts with them and vice-versa.
Just because you haven't got credit with these accounts, doesn't stop you trying to get credit elsewhere with a credit card or mortgage.
As I understand it, your credit rating is just used as a guide by financial companies as just one thing to look into when dealing with you. They also use multiple agencies.
Having no credit can be a negative as well because you have no "history" so there is no way of knowing if you are a good payer or are just going to run off with a load of cash. It's like you lending £50 to your mate Bob who you've known for 20 years - you know where he lives and he paid you back last time. On the other hand if you lend £50 to some chap you've just met in the pub, you're at great risk of not seeing that money again
if you had bothered to read the post properly you would have seen why i have opened 4 before casting silly aspersions.!...but yah from yawkshire so excused!...broad in the shoulder....etc, I'd hazard a guess that most people only have one or maybe two current accounts.
Maybe you have legitimate reasons. Maybe you're just opening them for the free money on offer. Or maybe you fancy doing a bit of fraud.
Once opened, what's to stop you asking each one for an overdraft. Bank A isn't going to check with banks B,C,D to check you haven't got huge unpayable overdrafts with them and vice-versa.
Just because you haven't got credit with these accounts, doesn't stop you trying to get credit elsewhere with a credit card or mortgage.
As I understand it, your credit rating is just used as a guide by financial companies as just one thing to look into when dealing with you. They also use multiple agencies.
Having no credit can be a negative as well because you have no "history" so there is no way of knowing if you are a good payer or are just going to run off with a load of cash. It's like you lending £50 to your mate Bob who you've known for 20 years - you know where he lives and he paid you back last time. On the other hand if you lend £50 to some chap you've just met in the pub, you're at great risk of not seeing that money again
i would think they could check if i have overdrafts and changed them to have overdraft facilities tbh given they can see how many current accounts i have and the history of actual my credit card record, my limit and average monthly spend, as well as the OD facility on my main current account and thats its never been used.... but then I'm ignorant in these matters...so perhaps they are not so clever.
Macneil said:
theplayingmantis said:
yes i appreciate that but was more curious to the logic and why a current a/c with no OD facility impacts a credit score and indicates a prepensity to need credit.
You're potentially overdrawn to the max on any number of other current accounts, your salary is getting swallowed up as soon as it goies in so you open a new account to protect it?Sarnie said:
theplayingmantis said:
Sarnie said:
If you don't need credit, you don't even need to concern yourself with your "score".
The "score" is simply an algorithmic number generated by what they (credit reference agencies) think are important to the businesses that lend people money.
A high score does not mean you will be accepted for credit.
A low score does not mean that you will be declined.
Lenders have their own internal score card and will make their own assessment of your circumstances, independent of whatever your "score" may be.
Your score will recover in time as the searches become more historic.
Everything on your credit file remains on there for 6 years.
yes i appreciate that but was more curious to the logic and why a current a/c with no OD facility impacts a credit score and indicates a prepensity to need credit.The "score" is simply an algorithmic number generated by what they (credit reference agencies) think are important to the businesses that lend people money.
A high score does not mean you will be accepted for credit.
A low score does not mean that you will be declined.
Lenders have their own internal score card and will make their own assessment of your circumstances, independent of whatever your "score" may be.
Your score will recover in time as the searches become more historic.
Everything on your credit file remains on there for 6 years.
WelshRich said:
In some circumstances a high score can actually reduce your chances of getting credit…
Years ago we were looking to buy some furniture that was available with a buy now, pay later deal - Interest free for 12 months but something like 30% APR on any balance outstanding at the end of the term.
I was declined, apparently because they targeted people with poor credit scores who were unlikely to pay the loan off during the interest free period. (I have no proof of this, just what the sales guy told me when I paid cash instead)
thats interesting, before i did this in late summer i went to by a new phone on voxi and was offered interest free payments over 2 years or pay it all off upfront, i thought i may as well use the monthly option as i could get interest albeit not a lot as only a grand or so in total but when clicked and put details in said this offer wasnt open to me.Years ago we were looking to buy some furniture that was available with a buy now, pay later deal - Interest free for 12 months but something like 30% APR on any balance outstanding at the end of the term.
I was declined, apparently because they targeted people with poor credit scores who were unlikely to pay the loan off during the interest free period. (I have no proof of this, just what the sales guy told me when I paid cash instead)
TownIdiot said:
It's all down to a "computer says no" style situation.
It's a basic rules based system and change isn't seen as a positive.
As an example
A couple of years ago we went through the process of guaranteeing a lease for our son and his mate
The system rejected us and when we asked why they looked into it and it was because we don't pay rent or have a mortgage, so the system couldn't provide the tick they required.
As soon as someone looked it was approved
thats another moderate risk on my credit score it shows, no mortgage record, but has always been the case, so obviously didnt impact my original 999 rating, fortunate never to have had a mortgage so far. It's a basic rules based system and change isn't seen as a positive.
As an example
A couple of years ago we went through the process of guaranteeing a lease for our son and his mate
The system rejected us and when we asked why they looked into it and it was because we don't pay rent or have a mortgage, so the system couldn't provide the tick they required.
As soon as someone looked it was approved
so all seems like a load of bllx.
thanks for the answers folks and yes i should have realized companies do their own checks and these agencies are not that useful for when and if i would need actual significant lendings.
cheers
theplayingmantis said:
if you had bothered to read the post properly you would have seen why i have opened 4 before casting silly aspersions.!...but yah from yawkshire so excused!...broad in the shoulder....etc,
i would think they could check if i have overdrafts and changed them to have overdraft facilities tbh given they can see how many current accounts i have and the history of actual my credit card record, my limit and average monthly spend, as well as the OD facility on my main current account and thats its never been used.... but then I'm ignorant in these matters...so perhaps they are not so clever.
lol, I'm not casting silly aspersions ... I was giving examples of why someone may open a number of current accounts in a short space of time. Some of them legitimate and some of them fraudulent.i would think they could check if i have overdrafts and changed them to have overdraft facilities tbh given they can see how many current accounts i have and the history of actual my credit card record, my limit and average monthly spend, as well as the OD facility on my main current account and thats its never been used.... but then I'm ignorant in these matters...so perhaps they are not so clever.
Fortunately I don't think even Experian can connect your bank account history with your PH posting with the reasons you explained for opening 4 current accounts in a month..
Maybe best you don't check your Transunion account though, as they're shock, horror based in Leeds in Yawkshire!
Edited by AngryYorkshireman on Tuesday 7th January 08:11
theplayingmantis said:
Sarnie said:
theplayingmantis said:
Sarnie said:
If you don't need credit, you don't even need to concern yourself with your "score".
The "score" is simply an algorithmic number generated by what they (credit reference agencies) think are important to the businesses that lend people money.
A high score does not mean you will be accepted for credit.
A low score does not mean that you will be declined.
Lenders have their own internal score card and will make their own assessment of your circumstances, independent of whatever your "score" may be.
Your score will recover in time as the searches become more historic.
Everything on your credit file remains on there for 6 years.
yes i appreciate that but was more curious to the logic and why a current a/c with no OD facility impacts a credit score and indicates a prepensity to need credit.The "score" is simply an algorithmic number generated by what they (credit reference agencies) think are important to the businesses that lend people money.
A high score does not mean you will be accepted for credit.
A low score does not mean that you will be declined.
Lenders have their own internal score card and will make their own assessment of your circumstances, independent of whatever your "score" may be.
Your score will recover in time as the searches become more historic.
Everything on your credit file remains on there for 6 years.
It won't link the number of searches then with the number of current accounts opened. This isn't the CIA or MI5. It's a very basic system with algorithms set up to try an interpret data to return a score.
The "score" is something that the credit referencing agencies have very successfully come up with, which does nothing but invoke anxiety in people, as per your OP. People with high scores are desperate to protect their number, people with low scores want help and advice to increase their score.
As a Mortgage Broker, I must read hundreds of credit files each month.
Some basic credit file advice;
- Make sure you are on the Electoral Roll, actually on the credit file, not just registered with the local authority
- Having a mortgage will boost your score, paying a mortgage off will reduce it, but in time it will increase again
- Don't miss any payments
- Keep credit card utilisation below 75% of the limit
- Don't apply large numbers of credit applications within a short period of time
- The value of a missed payment does not matter, a missed payment on a £12pm mobile phone contract has the same impact as a missed payment on a £900pm loan
- Ensure you update all addresses when you move house
- Everything on your credit file will remain there for 6 years
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