Discussion
I'm thinking about moving out of my parent's house and I'm looking to buy. Got a decent deposit and no debts, backed by a full time job.
The problem comes in that I have never had car finance, loans, mortgages, credit cards. Only thing I have had is a phone contract.
Will this go against me and give me a poor credit rating?
Any tips on how to check my rating and/or improve it?
The problem comes in that I have never had car finance, loans, mortgages, credit cards. Only thing I have had is a phone contract.
Will this go against me and give me a poor credit rating?
Any tips on how to check my rating and/or improve it?
Get as many credit cards as you can, max them all out, that might work.
Seriously, don't know, but money matters work in funny ways.
My OH who is a tad over 60, hasn't worked for 20 years, didn't have to. Her only income was from me as the housekeeping etc. Out of the blue, offered a 6k overdraft from the bank, more than me, and I am the breadwinner.
Good luck anyway.
Seriously, don't know, but money matters work in funny ways.
My OH who is a tad over 60, hasn't worked for 20 years, didn't have to. Her only income was from me as the housekeeping etc. Out of the blue, offered a 6k overdraft from the bank, more than me, and I am the breadwinner.
Good luck anyway.
Yes, your credit rating will be poor.
I own a couple of houses outright, have a couple of reasonable business interests, don't use credit, no mortgages or loans, just a credit card for business use and a mobile contract. Despite owing nothing to anyone and having a higher than average net worth, my credit rating is less than spectacular.
Good job I don't need any credit then really!
I own a couple of houses outright, have a couple of reasonable business interests, don't use credit, no mortgages or loans, just a credit card for business use and a mobile contract. Despite owing nothing to anyone and having a higher than average net worth, my credit rating is less than spectacular.
Good job I don't need any credit then really!
Yes that is the case. I tried a couple of years ago to invest in an ISA with the A & L BS. I got the knock back. Bearing in mind that I wanted to GIVE them money. When I enquired as to the reason all I got was that I had dipped the credit check, and to take it up with the credit agency. Now, my mortgage has been paid for a few years, I have no loans, I pay the CC bill every month, so I could not understand it.I thought I would be a very low risk customer.
So, I stumped up to the credit agancy for a report (£15.00 I think, at the time) and what came back was that I had failed because I had had no credit checks done on me in the past two years.
Credit checks are achieved obviously if you have a mortgage, take out a loan, even take out a mobile phone contract (mine was PAYG, so didn't count). In my case I had nothing for the prior few years, so in their eyes I am a high risk customer, but only because they have a lack of data on me. Even if you are a bad payer as long as you have, or have had, recorded credit then you will probably be ok.
What did surprise me was that in the credit report, they could go back 15 YEARS, and tell you every mortgage payment made and if it was on time, every loan you had taken out over that time, if the payments had been met regularly, and even if you had paid it off early, which I did a couple of times.
These people have a surprising amount of info available on us all.
Rgds
Phil
So, I stumped up to the credit agancy for a report (£15.00 I think, at the time) and what came back was that I had failed because I had had no credit checks done on me in the past two years.
Credit checks are achieved obviously if you have a mortgage, take out a loan, even take out a mobile phone contract (mine was PAYG, so didn't count). In my case I had nothing for the prior few years, so in their eyes I am a high risk customer, but only because they have a lack of data on me. Even if you are a bad payer as long as you have, or have had, recorded credit then you will probably be ok.
What did surprise me was that in the credit report, they could go back 15 YEARS, and tell you every mortgage payment made and if it was on time, every loan you had taken out over that time, if the payments had been met regularly, and even if you had paid it off early, which I did a couple of times.
These people have a surprising amount of info available on us all.
Rgds
Phil
Credit rating is a funny thing. People often tell me they have a score of 819 or 578 or what ever, it doesn't mean anything as lenders will score you differently depending on what type of business they are after. (i.e. first time buyer, remortgaging, high loan to value, self employed etc)
The tip about getting a credit card & using it is certainly true. If a lender credit checks you now then nothing will appear on your credit file (well apart from being registered at your address etc) but the lenders computer cant make a decision if your likely to repay a mortgage as there's no history. If it shows you have access to credit & pay it back regularly then it means you will probably pay a mortgage regularly every month & they like that.
The 2 biggest factors though is make sure your on the electoral roll at your current address & save as big a deposit as possible.
The deposit is the main one. You may well fail a lenders score with a 10% deposit but easily pass with a 25% deposit. You supply exactly the same info but the lender wants more security so a bigger deposit is required. I cant understand the credit score with Halifax at the moment, a case I had was a polish couple, in the UK 2 years, 3 different addresses in the last 3 years, been in jobs 6 months, no loans & 15% deposit, it passed easily on a high score. Another case I did the same week was an English couple, been renting for 4 years, both in same job for 2 years, 20% deposit but it failed. No reason, they just didn't get a high enough score.
So, the plan:
1) Get a credit card & use it & pay it off
2) Get on the voters roll if not already
3) Get a good deposit together.
4) Get a bigger deposit as that will over ride anything.
Good luck!
The tip about getting a credit card & using it is certainly true. If a lender credit checks you now then nothing will appear on your credit file (well apart from being registered at your address etc) but the lenders computer cant make a decision if your likely to repay a mortgage as there's no history. If it shows you have access to credit & pay it back regularly then it means you will probably pay a mortgage regularly every month & they like that.
The 2 biggest factors though is make sure your on the electoral roll at your current address & save as big a deposit as possible.
The deposit is the main one. You may well fail a lenders score with a 10% deposit but easily pass with a 25% deposit. You supply exactly the same info but the lender wants more security so a bigger deposit is required. I cant understand the credit score with Halifax at the moment, a case I had was a polish couple, in the UK 2 years, 3 different addresses in the last 3 years, been in jobs 6 months, no loans & 15% deposit, it passed easily on a high score. Another case I did the same week was an English couple, been renting for 4 years, both in same job for 2 years, 20% deposit but it failed. No reason, they just didn't get a high enough score.
So, the plan:
1) Get a credit card & use it & pay it off
2) Get on the voters roll if not already
3) Get a good deposit together.
4) Get a bigger deposit as that will over ride anything.
Good luck!
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