Stoozing, credit rating and first-time buyer

RubberDucky_3

All,

I found this site about 6 months ago and since then i'd like to think that i've been getting a little more money savy.

Now i'm a single man of 24 years, I work full time and earn about £22k gross.

Over the past few months i've been closing my accounts for storecards I only used once for the 10% off deal; purging my old bank accounts - closed 2 "young saver" accounts, cashed in my premium bonds, Halifax preference shares, the proceeds of which all went straight into my ISA!

I'm looking to use the money in this ISA as a part-deposit come the point (next year prolly) to *try* and get on this mess you call a property ladder.

Anyway... in between:
* i've opened an Egg savings account - to get a £50 reduction on my car insurance.
* i've opened a First Direct account to get the introductory £35.
* and i'm in the process of moving main bank accounts to Natwest Primeline for the £100 joining incentive.

I've recently (today) closed my MBNA Virgin credit card. I applied for this when I was working at Virgin Megastores on the promise of £20 free vouchers which never arrived... anyway I digress.

I would really like to get into this stoozing malarky but i'm worried about my credit rating and how a mortgage lender would view so many credit cards.

I applied for my credit report from Experian a few months back - I was surprised to find out it had my mothers details on it too (interesting read!!) I don't want to apply for ~6 credit cards only to find that doing so will adversly affect my ability to get a mortgage in 12 months time.

Do you think that there is a real risk that it would count against me if I had x credit cards with '000's debt on each one?


I hope this topic is not too much a repost of the similar question raised by Keanu http://forum.moneysavingexpert.com/cgi-bin/yabb/YaBB.cgi?board=Questions;action=display;num=1101317305 here

Martinslovechild

I wouldn't recommend that you start stoozing if you are definitely going to buy a property - it could potentially ruin your potential to obtain a mortgage.

Any mortgage lender will want to look at total debt, and although you & I know that the stooz isn't 'real debt', their computers may not see it that way. Also - I envisage that if the recent reports on house prices are anything to go by, then they will want to minimise risk as much as possible. You are a first-time buyer, you walk in there with £000's worth of perceived debt, do you have a minimum 5% deposit? - would you offer yourself a mortgage? You're much more likely to succeed with no debt (one credit card for regular use is OK).

Also, your mum's details should no longer appear on your credit file due to a (very) recent change in how these details now have to be reported.

Hope this doesn't sound too harsh - I just don't want you to ruin it all at the first hurdle. Stoozing should be around for a little while yet.

scheming_gypsy

kinda sounds a bit like me..

I have.. 4 credit cards, total debt of around 4k (on 0%, mainly car finance dumped onto them)

I earn just over 26.5k.

First time buyer.

I told my mortgage broker bloke all this info when looking for a mortgage. He applied to Halifax for a MIP of around 100 - 105k so i'd have an idea of houses to look for. The MIP came back at 119k. In the end i went for shared ownership, my share is £73,800 and i'm paying a 3% deposit.

Joe_Bloggs

@Rubberducky
Perhaps the safest thing to do is to go for a 0% purchase card and stash an equal amount of the spending total into your savings account. It is stoozing but on a small yet profitable scale.
J_B.