My First Credit Card

matttcattt

On this guide: "Credit Rating: How it works and how to improve it"
Under: "It’s about sophisticated customer weeding"
"Pay off in full every month, ... and if they can spot you, they may reject you."
I understood from this that if I pay off my balance in full every month the bank wont earn any money from the interest and this wont improve my credit rating. Have I misunderstood this? I dont spend beyond my means, so I dont mind paying a couple of pounds interest at most, each month.

NickX

matttcattt wrote: »

On this guide: "Credit Rating: How it works and how to improve it"
Under: "It’s about sophisticated customer weeding"
"Pay off in full every month, ... and if they can spot you, they may reject you."
I understood from this that if I pay off my balance in full every month the bank wont earn any money from the interest and this wont improve my credit rating. Have I misunderstood this? I dont spend beyond my means, so I dont mind paying a couple of pounds interest at most, each month.

The guide does say this but it doesn't advocate paying interest as a method to improve your Credit Rating.

Whether or not individual lenders do identify those that pay off in full is debateable, but each have their own lending criteria which can be weird and wonderful. There is no evidence to suggest that deliberately paying interest is going to help you in any way.

Bear in mind that even if you pay off in full, the Card Providers will still earn revenue from each transaction you make, so its unlikely that they would simply reject you for repaying past cards in full.

matttcattt

Ok, the general opinion seems to be I should pay off my card in full so I'll start doing that then.

As to my original question. Is it worth applying for another credit card now to boost my credit rating? I got turned down for a Virgin credit card about 18 months ago (havent applied for anything else before or since as I didnt want to damage my credit rating), but I've now been offered a "Vanquis Bank Visa Card" by MBNA via email. Im tempted to apply.

CannyJock

matttcattt wrote: »

Ok, the general opinion seems to be I should pay off my card in full so I'll start doing that then.

As to my original question. Is it worth applying for another credit card now to boost my credit rating? I got turned down for a Virgin credit card about 18 months ago (havent applied for anything else before or since as I didnt want to damage my credit rating), but I've now been offered a "Vanquis Bank Visa Card" by MBNA via email. Im tempted to apply.

As a general rule, you can apply every 3 months without affecting your credit score. Searches stay for 12 months but have been assured on multiple occasions by underwriters that they are "usually" ignored after 6 months. A search 18 months ago is long gone.