Are cash withdrawals bad for your credit rating?

lisyloo

Surely the ideal customer is someone who constantly misses the minimums but keeps things under control.

The anecdotal evidence is that most lenders prefer good credit ratings and don't go for people with missed payments.
Obviously there is a section of the market that targets sub-prime, but in general it seems most comapnies prefer those that don't miss payment (don't forget they make money from retailers, not just cardholders).
Also those paying the minimums are also paying interest as well.
So on the whole it doesn't look as though MOST card companies target people who miss payments.

I think I'm happy to have a couple of cash withdrawals per year on one credit account.
My gut feeling is that isn't goin g to ruin a good credit record.
Afterall tehy are looking for good management of debt not an abscense of it.

Jammi

Degenerate wrote: »

The problem is that for those of us using Santander Zero and Halifax Clarity for cash abroad, these assumptions are totally false. As long as it's paid off quickly, it's actually the cheapest way to obtain foreign currency cash.

I completely agree and thats why I went on to say:

Jammi wrote: »

That said, if I ever found myself short of cash before payday its cheaper to withdraw cash on my Halifax Clarity Card than dip into my agreed bank overdraft.

The concern however is that with the majority of card lenders still making hefty charges for cash withdrawals the perculiarity of Santander Zero and Halifax Clarity may not be recognised when it comes to credit scoring.

If One is on a fine line between acceptance and refusal of credit, cash withdrawals may well push One into refusal territory. However most people have either good or bad credit,and Cash withdrawals wouldn't turn good credit into bad.

Just my opinion.

lisyloo

Thanks for your opinion.
I'm not particualrly looking for any extra credit at the moment and have a mortgage that is very suitable long term, so I think I'm going to "risk" it.

I think you're correct that it's a minor factor, so won't ruin a very positive rating, but could be the last straw in a marginal situation. Luckily I'm not in a marginal situation or particularly wanting credit.