First Credit Card

ColdAsIce

Dear all,

This is my first fortee in the Money Saving Expert website, i had a few questions ive applied for my first credit card as i wanted one for emergency purposes etc. I had a few questions on terminology.

I initially applied for a Virgin Credit Card, but i got turned down because of my income criteria and not enough credit history etc. Will this impact my credit, will the credit card providing i pay on time help increase my credit rating etc.

I applied for the Capital one classic visa credit card, as im looking to build my credit rating as i dont have much history of credit.

34.9%APR is that the monthly interest rate if i dont pay my full balance on time e.g. if i spend £1000 i pay it off in 12 monthly installments, whatever i pay the minumum or max i still incur interest.

Balance transfers, i dont really understand this one anyone shed some light on this e.g. a basic example.

Also usually if i purchase something or pay for petrol can i make payment immediately before the statement is due? will this update on the system etc..

Golden rule, is i believe i want to build up my credit rating so i need to make sure i make payments on time etc.

Also what does it mean for up to 56 days interest free on purchases is that usually in the first month.

Sorry for the questions, just need clarifications and all, i intend to payment off my statement on time anyways. Any other further tips etc.

Look forward to hearing from you,

Regards,

ColdAsIce

SwissLe

Hello,

I'm not surprised you got turned down for a Virgin card, they do expect you to have some credit history purely because they offer good rates and want low risk people using it. They will have searched your credit file and this will show, however you have to have multiple searches in a short space of time for alarm bells to start ringing. I would take your Capital One card and use it to build your credit rating for a good few months, at least six. During this period don't apply for any more credit cards or indeed credit as a whole.

At that interest rate you need to be clearing the amount on a monthly basis. If you don't you are going to be asking for trouble in terms of temptation never to pay it off and paying interest needlessly.

A balance transfer means that when you get more of a credit rating you can apply for another card, say you have £500 on your Capital One and you apply for a Virgin. They offer a interest free balance transfer service so they would pay off your £500 to capital one and put it on your new Virgin card. This then means for that period you won't be paying 34.9%APR interest, you will pay nothing. This enables you to pay it off before the end of the period without paying interest.

You can make a payment to card whenever you want using a debit or bank transfter, it normally takes about 3-5 days to appear on your balance of the card and then that money will be avaliable for you to spend again.

If you spent £10 on petrol on day 1 of your credit card, you will not be charged interest on it for 56 days, if you pay it off in full then you will never pay anything. If you leave it past 56days then you will be charged interest on it. If you spent on day 4 of your billing cycle then it means you have 52days of interest free payments.

Spend small amounts on this card, say £50-100 of your £200 limit and then pay it off in full. They will soon put your limit up but keep with it for a little while just doing the small amounts and then apply for a 'better' credit card without the horrific interest rate.

ColdAsIce

Dear SwissLe,

Thanks for your advice.

Just to let you know ive got a £500 credit limit, bit weird as im earning less than £2k on my part time income.

Also will me getting rejected for a Virgin card leave a blueprint on my account.

You advised i dont apply for anymore credit and let this one build up my rating.

Did want to ask, i am going back to University in October do you advise i try for a student credit card, or do you advise i leave that and continue with the Capital one card.

Realistically im only going to be spending £20-£30 a month which i know i will pay back. Hopefully this will increase my credit limit on my 4th statement.

Thanks for your advice, i understand it some what.

Regards,

never-in-doubt

ColdAsIce wrote: »

Dear all,

This is my first fortee in the Money Saving Expert website, i had a few questions ive applied for my first credit card as i wanted one for emergency purposes etc. I had a few questions on terminology.

I initially applied for a Virgin Credit Card, but i got turned down because of my income criteria and not enough credit history etc. Will this impact my credit, will the credit card providing i pay on time help increase my credit rating etc.

I applied for the Capital one classic visa credit card, as im looking to build my credit rating as i dont have much history of credit.

34.9%APR is that the monthly interest rate if i dont pay my full balance on time e.g. if i spend £1000 i pay it off in 12 monthly installments, whatever i pay the minumum or max i still incur interest.

Balance transfers, i dont really understand this one anyone shed some light on this e.g. a basic example.

Also usually if i purchase something or pay for petrol can i make payment immediately before the statement is due? will this update on the system etc..

Golden rule, is i believe i want to build up my credit rating so i need to make sure i make payments on time etc.

Also what does it mean for up to 56 days interest free on purchases is that usually in the first month.

Sorry for the questions, just need clarifications and all, i intend to payment off my statement on time anyways. Any other further tips etc.

Look forward to hearing from you,

Regards,

ColdAsIce

Try reading this: http://forums.moneysavingexpert.com/showthread.html?t=1626277

Innocent_Guy

never-in-doubt wrote: »

Try reading this: http://forums.moneysavingexpert.com/showthread.html?t=1626277

Brilliant thread. If you got accepted for Capital One at £500 pay it on time every month and expect to see the limit rise to £1250