Can't get Switch but can get Credit Card

Jonni2bad

I have had debt problems over the past 12 - 18 months and had to switch to a Basic bank account (with HSBC). Despite running this account very well (not even being close to overdrawn / no returned payment etc etc) my credit 'worthyness' is still too low for me to move up to a current account.

Problem is - I could really benefit from the advantages of a switch card (or very similar) as I have seen many offers that can't really be taken advantage of unless you can pay with a card. I have been able to use a relative's card every now and then, but this is not ideal.

I have recently seen an advert for Capital One which says EVERYONE who applies can get a credit card, although I am likely to get the minimum amount of credit (£200) and have to pay a deposit up front. All this is fine by me since my credit history is something I will just have to pay the ongoing price for, but I wondered if anyone out there knows of any alternatives for someone with a very poor credit history?

I am NOT looking to take advantage of increased credit or to spend money for the sake of it, and would opt for this credit card only on the basis that I would then have an alternative payment option. I would be paying off anything spent in this way immediately, so the high APR associated with the card does not concern me.

Any help or advice would be greatly appreciated, and please also bear in mind that this is the first new topic I have created...!

Thanks in advance
John.

Debt_Free_Chick

Hi John

Yes, the Cap One card is targetted at those who want to build up their credit record. If you use it as you suggest - by paying it off in full, every time - you will improve your credit record.

However, HSBC may not look at your credit record. They will probably just rely on their own experience of the way you manage your account.

You could build up your credit record using the Cap One card and then switch to another bank though

Or, perhaps, ask HSBC to consider a credit record check, after a period of time.

Have you got your credit record? It might be useful for you to see what's on there.

https://www.experian.co.uk

https://www.equifax.co.uk

Don't bother with the online version at about £10. You can apply online for a paper copy of your record to be sent by post, for just £2

HTH

Jonni2bad

Thanks for your reply

I've thought about getting my latest credit file, but wondered if it would really be of any use since I wasn't interested in any new credit and have previously had defaults - but that's another query! I know I've mentioned the Cap One card, but like I said it really was just to enable me to finally get some other form of payment option rather than cash, not for the credit.

I have been paying off my creditors as per an agreed payment plan for over 12 months now, and I've met every one, but will this in itself be helping my credit worthyness, or would potential 'lenders' just see that I am not paying off the FULL monthly repayment, and so not improve until I'm repaying the normal full amounts??

I didn't ask HSBC to consider a current account until I had been operating the basic one properly for a year, so I was quite surprised they turned me down, especially since I told them I didn't want an overdraft, just a switch card. Other than that I have no gripes with them..

Questions, questions.........

Tony_H_3

You mention about repayments being made via an agreed payment plan, are you paying interest or has the interest been frozen on these repayments?

Jonni2bad

I'm repaying 4 in total -

2 reduced the interest much lower than it had originally been
1 is 'temporarily' interest free (but has been going on for 12 months now thankfully)
and last one refused point blank to reduce interest, despite many attempts and much brown nosing, so I'm only paying off a very small amount of actual debt on that one.

(My original mortgage arrears were being paid off monthly until they were capitalised, which seemed to make more sense).

Tony_H_3

I'm no expert, but this is most probably the reason why HSBC will not allow you a switch card.

Jonni2bad

I'm no expert, but this is most probably the reason why HSBC will not allow you a switch card.

Which bit? The fact they are being paid off at reduced amounts?

Tony_H_3

The fact that you have "Agreed Reduced Repayment Plans"

When this happens the creditors mark your credit file hence the fact that you have been offered only a "Secured Credit Card". Until such times as your creditors have "unmarked" your credit file you will not be able to get a switch card.

HSBC do offer a "Solo" card which is similiar to switch, but it cannot be used to guaruntee cheques for example.

But more and more retailers are excepting Solo as a payment method & this is more common place amongst online retailers.

Jonni2bad

Many thanks for your help, much appreciated.

Tony_H_3

I'm afraid I wasn't very helpful, I don't know much about debt's and repayments etc. But with Solo being more widely accepted it has to be a considered alternative.

The problem with Switch is that it also has "Cheque Guaruntee" saddle with it. This will obviously be an issue which prevents you from getting a Switch card.

Effectively the bank isn't in a position to offer you credit, this is effectively what a cheque guaruntee card would give you eg a cheque book with 30 cheque would be equal to £1500.00 of credit.

If you are desperate for a Switch card you could speak personally with the bank & surrender any cheques that you may have? But I personally can't see the bank allowing this.
May'be someone in the know will be able to offer further advice.

Malestrom

Thanks to the OP of this thread, i've just been approved for a Capital One card even though my credit record is a bit pants. I'm happy to have a card with a £250 limit even if I have to guarantee it with a deposit, as Halifax have turned us down 3 times for a switch card. Trying to shop on the net with a Solo card (now changed to a Visa Electron thanks to chip 'n' pin) can be a nightmare. I've even been refused in garages and supermarkets with a "sorry, dont take Solo", which is both annoying and embarrasing. At least now I'll have some backup!

Hadn't seen this offer so thanks once again to the OP