Student in some trouble w/credit rating already!

hennerz

I've had an HSBC young person's account for a while until I turned 18 (I am now 19) and it became a normal Current Account (I have a debit card with it). I have been actively using it and now have been upgraded to an ADVANCE A/C account.

I wanted to get a good credit rating while young, but didn't research properly and just applied to get 3 or 4 credit cards. Obviously as a student with an income of ~£6k a year from online poker I got rejected from ALL of them.

I have also had a fine to my bank, where my landlord tried to take my rent from the wrong bank account, meaning there wasn't enough in the account to pay the direct debit (incurring a £20 fee!). It was my Landlords fault, but I don't think there is anything I can do about that?!

Anyway, I now know I must get some credit if there is any chance of getting enough credit to buy a house when I'm around 22... I have ~£3k in my HSBC and have £1k in a Britania savings account I have had since young. I also have a Co-Op current account (with electron card).

I believe I am on the electoral roll and have lived at my current address (my parents) for 15years +

What shall I do about my credit score? How deep am I in trouble? Should I open some student accounts at Natwest and HSBC to try and get Student Credit Cards as my next step?

:T - First post, great site!

skyrider007

Try getting a student account from HSBC. Are you going to uni this year? If so wait till July or August when they will have promotions like free rail card or something then apply.

Being rejected by 4 different card issuers doesn't mean your credit rating is screwed up. You probably just need to build up some payment history with a few green ticks before they start approving you cards.

Kavanne

Did you try HSBC? If so and was rejected you might want to look at some 'sub prime' cards. They have high APRs but if you pay them off in full each month, that won't matter

SwissLe

I don't think you really have a great attitude to building a credit rating. You don't need multiple cards, they will be a huge temptation being a student and a gambler all in one.

I would get one card, ideally a specialised student one with a good APR then start spending small amounts on it and settling it via direct debit each month. Oh and remember to get it coming out of the right bank account this time - no credit file is better than one with missed payments and defaults

hennerz

Thanks for the replies, so fast!

skyrider007 wrote: »

Try getting a student account from HSBC. Are you going to uni this year? If so wait till July or August when they will have promotions like free rail card or something then apply.

Being rejected by 4 different card issuers doesn't mean your credit rating is screwed up. You probably just need to build up some payment history with a few green ticks before they start approving you cards.

I am currently in my second year at university. I lived in halls in the first year and now rent a student house with friends, fwiw. What does it mean for my credit rating? I have had a phone contract for the last year also, if that counts for anything, with direct debit every month. Should I apply in store for these also?

Kavanne wrote: »

Did you try HSBC? If so and was rejected you might want to look at some 'sub prime' cards. They have high APRs but if you pay them off in full each month, that won't matter

I did try the HSBC Credit Card iirc and didn't get a reason for failing. Will they accept anyone on the high APR cards? Should I be putting £6k as my annual income (even though it's from online poker)?

SwissLe wrote: »

I don't think you really have a great attitude to building a credit rating. You don't need multiple cards, they will be a huge temptation being a student and a gambler all in one.

I would get one card, ideally a specialised student one with a good APR then start spending small amounts on it and settling it via direct debit each month. Oh and remember to get it coming out of the right bank account this time - no credit file is better than one with missed payments and defaults

TBH from poker and being a student I have learned to manage the money I do have more efficiently. I really want to be a property developer/investor when I am older, which is why I really want a good amount of credit available.

Also regarding the failed direct debit, with my Landlord, it wasn't my fault, but I think there is nothing I can do now?

Stinkybell

Step 1 - get a STUDENT bank account (NatWest allowed me to open a student account partway thru a year at Uni as I told them I didn't get a loan paid into my current account and survived off parental handouts. Do it in branch - they are paid a small commission and you're less likely to be rejected)


Step 2 - apply for the STUDENT credit card from that bank. The limit will be pants, but it gives you the opportunity to build up a good payment record etc.

TheEffect

I'm 18, have played poker for quite a while and made a little (yes, even when I was under 18) and am currently building my credit rating, so know a little about it.

1) Stop playing poker and get a part time job. While you may be making some profit playing poker, I know from experience that it's very addictive, can lead to gambling problems and overall, you don't actually earn as much as you think you do. I'm not saying this is the case for you, but I would definitely look at getting a part-time-job to topup your income.

2) Do not open any more current accounts. While current accounts report green 0's to your credit report, unless you have an overdraft on the accounts and are using it/repaying it, then it's not looked at as much as a credit card.

3) Keep up the payments on your mobile contract. This is reported to the credit reference agencies and will help your credit rating quite a bit.

4) Any applications leave a search on your credit rating, such as the 4 you will have from the declined cards. Many (more then 2) searches in a very short period of time (months) can damage your credit rating. If you have 4 searches within the last 3 months, leave it 6 months before applying for anything. This will give you credit rating time to improve and show you actually aren't desperate for credit.

5) If you are planning on paying off a credit card each month, get a sub-prime credit card. If you have no defaults and no ccj's, they're very likely to accept you. Sub-prime credit cards are Vanquis, Aqua, BarclayCard Initial (You don't earn enough to apply for this card = £10k), CapitalOne Classic. Get ONE of these, pay for it each month in full via direct debit.

Do this and your credit rating will be fine in a year.

jonesMUFCforever

I know of one route which will eventually DESTROY your credit rating - its called gambling.#
Eventually you will hit a losing streak and you will gamble that little bit more to try and win back your losses ....................you know the rest.

Also say that you apply for a mortgage somewhere and your case is borderline what do you think would happen to your application if they asked to see your bank/credit card statements and saw loads of betting transactions?

I don't have to type the answer do I?

You would be classed as high risk.

hennerz

Thanks again guys.

So my steps are:

1 - Natwest and HSBC Student accounts - then after a month or so (?) apply for student credit cards in both. Applying for both account and CC in branch.

2 - Sub-Prime Credit Card - CapitalOne Classic I think. Should I apply for this now? Or wait 6months to be sure of acceptance?

jonesMUFCforever

You really are in trouble arent you?

hennerz

jonesMUFCforever wrote: »

You really are in trouble arent you?

You tell me?