Poor Credit Rating because of no Credit History

katharinespencer

I'm hoping that I can get advice regarding this problem...

For years I have lived without using Credit Cards or getting any type of loan. I earn over £1300 every month and my husband and I pay our bills without getting in to debt by using the money that we have and nothing else.

We are looking in to getting a mortgage and thought that it would be a good idea to have a look at our credit rating/scores. My husband's are fine, that is because he has a store card that he had before we got together and had paid it off. My credit rating shows up as being poor with all three Credit Agencies (Experian, Equifax and Call Credit), the reason being that I have no record of having any credit. My own bank account does not show up on the reports as it is a Flex Account (Visa Debit) so they said that as it is a savings account it will not show up. I have used Experian's new feature of searching for credit cards according to my credit score, the one card that they came up with turned me down which has now probably made my score worse. I have applied for the Credit Builder Credit Card advertised on here which I will have through soon but I am looking for other ways to improve my score sooner. I am on the electoral role, I have no CCJ's, and as stated above HAVE NEVER BEEN IN DEBT!!! :mad:

I feel as though I am being penalised by living by my means and therefore have a poor credit score which means that I cannot get any type of credit even though I have tried for years to make sure that I don't get in to any type of debt.

I would be really grateful for any ideas or support, I'm getting so stressed because I just want to get it sorted and feel like I'm hitting brick walls wherever I go!!

Thanks x

[Deleted User]

What was the card you applied for?

BugsyBrowne

katharinespencer wrote: »

I'm hoping that I can get advice regarding this problem...

For years I have lived without using Credit Cards or getting any type of loan. I earn over £1300 every month and my husband and I pay our bills without getting in to debt by using the money that we have and nothing else.

We are looking in to getting a mortgage and thought that it would be a good idea to have a look at our credit rating/scores. My husband's are fine, that is because he has a store card that he had before we got together and had paid it off. My credit rating shows up as being poor with all three Credit Agencies (Experian, Equifax and Call Credit), the reason being that I have no record of having any credit. My own bank account does not show up on the reports as it is a Flex Account (Visa Debit) so they said that as it is a savings account it will not show up. I have used Experian's new feature of searching for credit cards according to my credit score, the one card that they came up with turned me down which has now probably made my score worse. I have applied for the Credit Builder Credit Card advertised on here which I will have through soon but I am looking for other ways to improve my score sooner. I am on the electoral role, I have no CCJ's, and as stated above HAVE NEVER BEEN IN DEBT!!! :mad:

I feel as though I am being penalised by living by my means and therefore have a poor credit score which means that I cannot get any type of credit even though I have tried for years to make sure that I don't get in to any type of debt.

I would be really grateful for any ideas or support, I'm getting so stressed because I just want to get it sorted and feel like I'm hitting brick walls wherever I go!!

Thanks x

Yeah appreciated that you have never been in debt,but banks are not going to just lend to any !!!!!! & tom without knowing how the applicants have managed money before.

How do the banks know that you will pay it back?

p00hsticks

Was the one you applied for with your current bank/building society (Nationwide ?) If not, I suggest you try there first - they have evidence of your financial history without having to just go by your non-existent credit history and so should be more willing to give you a card.

Any

katharinespencer wrote: »

I am on the electoral role, I have no CCJ's, and as stated above HAVE NEVER BEEN IN DEBT!!! :mad:

I feel as though I am being penalised by living by my means and therefore have a poor credit score which means that I cannot get any type of credit even though I have tried for years to make sure that I don't get in to any type of debt.

I would be really grateful for any ideas or support, I'm getting so stressed because I just want to get it sorted and feel like I'm hitting brick walls wherever I go!!

Thanks x

Why do people constantly keep thinking this????????? :mad:

Have a look at it from their perspective - are you going to lend a money to a person that you have no references on?????

The credit report reports on the money someone was willing to lend you or give you the opportunity to and how are you managing this. If they see you are reallly responsible person who manages well then they will take the risk of lending you money too.

I don't believe that you would just lend money to a stranger who walks up to you on the street, would you??

Store accounts, phone contracts, credit cards... that all helps to build your credit report. Anything that is on credit - where people give you goods or services without immediate exchange of cash.

Also agree with Poohstick - your own bank also has the chance of seeing how do you deal with your own cash (current account - noone else does) and they are more likely to trust you with their card.

chexum

katharinespencer wrote: »

My own bank account does not show up on the reports as it is a Flex Account (Visa Debit) so they said that as it is a savings account it will not show up.

No, you're describing a full-fledged current account, but some years ago the terms and conditions did not allow sharing positive information with credit reference agencies, so they will not do it, unless you apply for a new credit account that will let them. NOTE - Closing the account is not recommended even if you completely fed up with them as you probable have opened it before the carpet-bagger rules, so you may get some funds if (if) they happen to demutualise. Just make sure you continue to qualify as a member..)

katharinespencer wrote: »

the one card that they came up with turned me down which has now probably made my score worse.

No, you just have a search recorded with the appropriate agency - it's not the end of the world, it's completely normal to apply for new credit once in a while. This marker will not be considered important in 6 months, and drop off in 12.

katharinespencer wrote: »

I feel as though I am being penalised by living by my means

No, you're simply not allowed to start an arbitrarily high level in the game when you haven't played it before. That's nothing to worry about.

Listen to the people before me, ask nationwide to see if you qualify for a credit card, They know your real history that they are not sharing with anyone else (and will not, don't press that). As soon as you have a card, your history is almost good enough to go.

If they still can't get their act together (there are many reports of their recent customer service fiascos), just see any credit builder card - Capital one, Aqua, or as a last resort, Vanquis (my order of preference, others may think differently).

You may need a year or two for it to play out perfectly, but this is not really unexpected, I'm afraid.

Any

Very well said Chexum.

katharinespencer

The card that I applied for was a Barclays Starter Credit Card, they did mention Aqua as well but didn't go with them because it was the second choice.

I have been to Nationwide and they have told me that all they will give me is a cash card without a cheque book (been with them for about 15 years so not very impressed!!)

I completely understand the idea that they won't give me any credit because they can't see that I can manage my money but I can't get the opportunity to get the credit to prove to them that I can manage it so just trying to find out where I can start, been working on this for ages and haven't really been able to get anywhere. I have spoken to Nationwide on the phone for advice and they say that they should give me a card etc but when I go in to the Branch it is a different story.

Is there a specific name of the Capital One Credit Card that you were talking about or maybe I should ring them up and exlpain my situation and they will tell me which is the most appropriate???? Also thinking of getting a phone contract with Carphone Warehouse as they do not do credit checks, however me doing that would mean that I am spending more money on a phone than I currently am on a Pay as You Go!!

I really appreciate everybody's help with this so thanks and look forward to your further advice x

BugsyBrowne

katharinespencer wrote: »

The card that I applied for was a Barclays Starter Credit Card, they did mention Aqua as well but didn't go with them because it was the second choice.

I have been to Nationwide and they have told me that all they will give me is a cash card without a cheque book (been with them for about 15 years so not very impressed!!)

I completely understand the idea that they won't give me any credit because they can't see that I can manage my money but I can't get the opportunity to get the credit to prove to them that I can manage it so just trying to find out where I can start, been working on this for ages and haven't really been able to get anywhere. I have spoken to Nationwide on the phone for advice and they say that they should give me a card etc but when I go in to the Branch it is a different story.

Is there a specific name of the Capital One Credit Card that you were talking about or maybe I should ring them up and exlpain my situation and they will tell me which is the most appropriate???? Also thinking of getting a phone contract with Carphone Warehouse as they do not do credit checks, however me doing that would mean that I am spending more money on a phone than I currently am on a Pay as You Go!!

I really appreciate everybody's help with this so thanks and look forward to your further advice x

You should of got yourself a phone on contract 2 years ago then you won't be asking why no banks will touch you..

Personally try capital one classic,then if that card is unsuccessful you will have to try vanquis,give it 18 months then approach the bigger lenders.

knightfox

Well I would apply online for the nationwide account. Then you dont need to worry about the sales people in the branch.

You say you have never been in debt. But its not a case of being in debt its been able to manage money. This is different to being in debt. People get themselves in trouble for a number of reasons but thats life. The banks mank money on that. They know there is a risk involved. But by not showing you are able to manage the risk you have the problems you are in today.

Otherwise or as well look at capital one. There website is now designed very well for everyone. Ie from no history (you) to the people with good history.

chexum

katharinespencer wrote: »

I have been to Nationwide and they have told me that all they will give me is a cash card without a cheque book (been with them for about 15 years so not very impressed!!)

So you did apply for a credit card with them? That is very strange - it would look like something is strange with your identification, either the addresses are a bit different from the official ones, or other basic information is not matching with their records.

Whatever you do, don't close that account if you joined them before 1997 - keep it for souvenirs

I think you have a full current account (can do direct debits, has debit card, cheque-book?), but as they don't report it, they are the only lender that can consider your account conduct. I would check the statutory credit reports (Experian and/or Equifax) if something fishy is on there. All addresses should be correct with moving information, electoral roll information present, no negative information, no GAIN, CIFAS entries. (Hopefully no defaults/CCJs either).

The credit reports should list your recent attempts at applying for credit - if they don't, then you either failed some basic criteria (income, profession, employment), or even identification. Even employee addresses and work/home phones can be crossreferenced between applications, so if you keep changing what you enter, that won't help.

If you have joint accounts/mortgage, adverse information can be considered from the people you are (or appear) financially associated with - you won't see that on your own personal report, you may need to check with them as well.

Check the forums and the main site if you think something strange is on the report. If you don't have any record of a current/credit/mobile phone account, you'd be considered an absolute begginner at banking, so you may be better off starting a new life at a new bank with a full (but free) account, maybe they can consider looking at your bank statements and giving you a nominal (£10-£100) overdraft and/or a credit card with a low limit.

Quite unusually you may try bringing a letter from your employer (are you employed?) to confirm you're at work, to that new bank and explain that you need better services (but for free) that your old bank is not willing to provide.

It helps to know (from the forums, again), which bank uses which CRA and when - credit cards from the same bank occasionally search a different agency. You can then make educated guesses when is it right to apply for a card with a given company to not "appear" desperate for credit. One search every 1-2 months is fine even for an extended period. 3-4 is not a problem even at once if you haven't done anything in the past year either.

Many banks seem to be quite picky these days for new customers.

If you have any account conduct reported, you can expect your chances improve after 6, 12 and 18 months. That is, if you can open a full account with a minimal overdraft, you can push that higher in about 6 months, and you may be able to get a real credit card a year after that. It's all about selling yourself, and knowing your league. If otherwise you are a normal person - not moved in a few years, has stable employment - then you should be much better off in 2 years credit-wise.

You can try reading the "Sub Prime Credit Threads" for hints on how to quickstart your credit file - mobile accounts (Sim Zero from 3), catalogue accounts, finding less picky banks/card issuers.

The usual sub prime card issuers are:
- Capital One Classic Visa - they have other cards for people with established credit history
- Aqua (from BOS/Halifax)
- Vanquis - with horrendous APRs for beginners
- Barclays Initial - that you mentioned, maybe you can try to appeal their decision in writing, depending on what did they say when they rejected your application.

They all have different criteria, at least one of them seems to work for someone after making sure the credit file is in order (even if empty-ish).