Sooo confused. Need help from seasoned credit experts!

moneysavingallday

Kavanne wrote: »

Yeah but what is the APR, like 15%? It's sitting in a savings account at 4% and you are losing a LOT of money.

I'm losing a total of about £100 over the duration of the loan. That's not that much money to me and it is worth it to me to build a strong credit profile.

Kavanne

moneysavingallday wrote: »

I'm losing a total of about £100 over the duration of the loan. That's not that much money to me and it is worth it to me to build a strong credit profile.

Oooooookay!

Just to let you know I never had loans before I got my mortgage. Only 2 credit cards which I pay off in full each month. And I was only 20 so had only had them 1.5 yrs at the time....

YorkshireBoy

moneysavingallday wrote: »

I'm losing a total of about £100 over the duration of the loan. That's not that much money to me and it is worth it to me to build a strong credit profile.

Madness...utter and complete madness (IMHO)!!

And the very fact you *have* a loan will, if indeed HSBC decide to report it (and they might not), probably even LOWER your credit rating in the interim period.

moneysavingallday

YorkshireBoy wrote: »

Madness...utter and complete madness (IMHO)!!

And the very fact you *have* a loan will, if indeed HSBC decide to report it (and they might not), probably even LOWER your credit rating in the interim period.

Your response is a tad melodramatic I think.
The (independent) mortgage advisor suggested that a good mix to have on my credit report is:

1 or 2 credit cards
an unsecured loan of some kind
mobile phone contract and/or catalogue

To be honest I think that the fully paid loan I'll have on there a year from now is a good look and not a bad one. Especially since there is no other outstanding debt on the report and I've no need to apply for anything else before the loan's paid off.

moneysavingallday

Kavanne wrote: »

Oooooookay!

Just to let you know I never had loans before I got my mortgage. Only 2 credit cards which I pay off in full each month. And I was only 20 so had only had them 1.5 yrs at the time....

I bet that mortgage approval wasn't in today's climate!

YorkshireBoy

moneysavingallday wrote: »

Your response is a tad melodramatic I think.

Of course you're entitled to your opinion. However, I stand by my opinion, which is based on considerable knowledge of credit scoring/rating issues...with a large dose of common sense thrown in - you don't need to *buy* a credit rating. What's you opinion based on?...Oh, I see it's based on...

The (independent) mortgage advisor suggested that a good mix to have on my credit report is:

1 or 2 credit cards
an unsecured loan of some kind
mobile phone contract and/or catalogue

To be honest I think that the fully paid loan I'll have on there a year from now is a good look and not a bad one.

Lets hope what you think will happen actually does happen then.

Good luck.

moneysavingallday

Thanks Yorkshire Boy

poppy_f1

personally i'd get rid of the loan - it may do you some favours, but nothing that say a next/littlewoods account wont do for you
credit ratings wont look at what types of acccounts you have had as such, they are looking for the ability to pay on time (plus the next directory account comes in handy at sale times

also by getting rid of the loan you lessen the risk of actually using some of the money for other purposes - at the moment im assuming you would make the loan repayments from the loan itself plus coughing up the interest

moneysavingallday

poppy_f1 wrote: »

personally i'd get rid of the loan - it may do you some favours, but nothing that say a next/littlewoods account wont do for you
credit ratings wont look at what types of acccounts you have had as such, they are looking for the ability to pay on time (plus the next directory account comes in handy at sale times

also by getting rid of the loan you lessen the risk of actually using some of the money for other purposes - at the moment im assuming you would make the loan repayments from the loan itself plus coughing up the interest

Thanks for the advice. However, the loan's for £2k and my monthly take-home's just over £4k. I've also got 12 months' living expenses in a savings account. With that lot in place, if I felt the need to start dipping into the £2k loan it would mean that I'd developed the mother of all crack addictions or something.. The loan money's sitting in an account soaking up 8 or 10% interest - I'm gonna be just fine. Now if it was a £20,000 loan, it might be a problem

Kavanne

You have an account paying10%?! I want this account