credit check

f.dennis

Hi all i'm hoping someone can shed some light. I'm in the process of applying to rent a flat and have just had a phone call to say that I need a guarantor as my credit check is too low. What does this mean?

I don't and have never had any loans apart from my student loan and don't understand what the problem is.

Thanks

m_13

After we'd sold our house we moved into rented as we'd relocated. Our mortgage was paid off and we had no loans at all. We then bought the property we are in now mortgage free (we moved from a house into a flat).

We then tried to take out a loan for a car and were told we had a poor credit rating basically because we had no outstanding credit. I posted for advice on this very forum and eventually A&L offered us a loan but we pay a higher rate than we would have paid normally.

It may be your lack of debt, however ridiculous that sounds, that is giving you the low rating!

Martin has an article on improving your credit rating here: http://www.moneysavingexpert.com/loans/credit-rating-credit-score

laughingcow81

I think as you probably have never taken out any other loans, credit cards etc. then the credit companies don't know your status - actually taking out a credit card can help you and establishes a credit history.

f.dennis

m_13 wrote: »

After we'd sold our house we moved into rented as we'd relocated. Our mortgage was paid off and we had no loans at all. We then bought the property we are in now mortgage free (we moved from a house into a flat).

We then tried to take out a loan for a car and were told we had a poor credit rating basically because we had no outstanding credit. I posted for advice on this very forum and eventually A&L offered us a loan but we pay a higher rate than we would have paid normally.

It may be your lack of debt, however ridiculous that sounds, that is giving you the low rating!

Martin has an article on improving your credit rating here: http://www.moneysavingexpert.com/loans/credit-rating-credit-score

That's unbelievable! So by actually being a good working person who works long hours etc so that they have no loans etc, u are actually worse off than someone who is struggling in terms of a credit check!!

If i'm not able to get a guarantor then will I be turned down?

richardginger

Absolutely right, amazing situation is it not! If you can't get a guarantor you will be turned down but you may want to try different rental agents because a credit check is not always necessary. Even if you took out some credit cards to boost your credit score it would probably take 6 months or so to show up on your credit score.

bmunky7

As richardginger says it will take some time to establish a decent history (although getting a credit card now and using it but always paying it off each month in full will help in the future).

Possible other ways to be able to get the flat is to offer a larger deposit of 2 - 3 months if possible, or to explain the situation to the landlord / letting agent.

Cutting out the letting agent altogether may mean no credit checks.

m_13

Unbelievable it may be but unfortunately no credit history means no track record apparently despite the fact that we had just paid a mortgage off 15 years early!

We do have credit cards now which we pay off each month and have had no problems since. The platinum AMEX is very good as you get cashback - top buy on here - and we got cashback from Quidco for taking it out.

However, I digress. Since taking out the car loan and the credit cards my credit rate is much better. Mad

f.dennis

Thanks everyone for your comments. I just can't believe that one can get potentially turned down for not having had a loan, mortgage etc. Most people would consider that a good thing.

My parents have said they will be my guarantor's and I am going to look into a credit card to build up my history for the future.

Fire_Fox

Did you never have a student bank account with interest free overdraft facility? No mobile phone contract? No landline or broadband contracts whilst a student? Both of these should leave positive 'footprints' on your credit file assuming good conduct. Are you registered to vote at your current address, and are all bank accounts or phone contracts registered to your current address? Have you had a look at your own credit histories with Experian and Equifax to ensure nobody has used your identity?

f.dennis

Fire_Fox wrote: »

Did you never have a student bank account with interest free overdraft facility? No mobile phone contract? No landline or broadband contracts whilst a student? Both of these should leave positive 'footprints' on your credit file assuming good conduct. Are you registered to vote at your current address, and are all bank accounts or phone contracts registered to your current address? Have you had a look at your own credit histories with Experian and Equifax to ensure nobody has used your identity?

I have a student bank account with an interest free overdraft. While a student, the water bill was in my name, don't know if that has any impact. We all had a bill each you see. I am registered to vote at this address and bank accounts are also registered to this address.

Does student loan have an impact on your credit history? I am starting a new job next monday over £15,000 salary and so will start paying it back. Will this be taken into account in the future?