Credit Report Questions

jakesuk

I'd be interested to know what peoples answers are to the following two questions. Which of the following is best for your credit report?

1) 2 x credit cards with same credit limit and
a) Both cards show on report as 50% credit used
b) One card shows on report as 100%, the second shows 0%
c) (a) and (b) are infact the same as far as any potential lender is concerned since total available credit and used credit is the same so it's indifferent.

2) People always say that unused credit is important so potential lenders don't see you struggling with your debts, but then people also say that if you have access to too much credit, lenders will be less likely to offer new credit if current available credit is x% of income. Where is the line between these?

Any advice appreciated.
Thanks

BugsyBrowne

jakesuk wrote: »

I'd be interested to know what peoples answers are to the following two questions. Which of the following is best for your credit report?

1) 2 x credit cards with same credit limit and
a) Both cards show on report as 50% credit used
b) One card shows on report as 100%, the second shows 0%
c) (a) and (b) are infact the same as far as any potential lender is concerned since total available credit and used credit is the same so it's indifferent.

2) People always say that unused credit is important so potential lenders don't see you struggling with your debts, but then people also say that if you have access to too much credit, lenders will be less likely to offer new credit if current available credit is x% of income. Where is the line between these?

Any advice appreciated.
Thanks

Totally agree people come on here and say to much available credit goes against you,but then say not enough credit available goes against you as well.

The truth is no one knows,the computer that do applications at the bank knows but don't think he takes personal calls to ask him.

KingElvis

Too much available / used credit in comparison to your income is bad, that's why the advice is to close unused cards.

Well run accounts mean more however so always stay within limits, pay off more than the minimum and just be good.

jakesuk

Thanks for the replies.

The issue here is I have recently been rejected for a couple of cards (applications spread out - I maybe have 4 or 5 credit applications in the last 12 months).

For over 12 months I have had the following:
- 1 0% stooze card - maxed out.
- 1 day-to-day card - pay off in full every month - limit not too high so usually at 50% of balance.
- 1 final card, usually make small purchase each month and pay off in full.

I've never made a late payment, always pay in full each month, haven't had many applications. Can't work out why I am being rejected!

The total credit available from credit cards is less than 20% of my salary. I am electoral roll etc. 2-3 years ago I had no credit history but I have had the above cards for over 12 months now.

Where am I going wrong? How can I imrpove?

BugsyBrowne

jakesuk wrote: »

Thanks for the replies.

The issue here is I have recently been rejected for a couple of cards (applications spread out - I maybe have 4 or 5 credit applications in the last 12 months).

For over 12 months I have had the following:
- 1 0% stooze card - maxed out.
- 1 day-to-day card - pay off in full every month - limit not too high so usually at 50% of balance.
- 1 final card, usually make small purchase each month and pay off in full.

I've never made a late payment, always pay in full each month, haven't had many applications. Can't work out why I am being rejected!

The total credit available from credit cards is less than 20% of my salary. I am electoral roll etc. 2-3 years ago I had no credit history but I have had the above cards for over 12 months now.

Where am I going wrong? How can I imrpove?

http://www.flybe.com/card/ give these a try

danothy

I would liken it to SEO in that you never really know where the lines are drawn, but if you design a website well and have good, valuable content on it then it will attract high ranking search results because the ranking metrics are designed to value this.

Comparatively if you manage your debts well (not have an unaffordable amount available, demonstrate you are paying it off reliably and so on) then you will naturally find the middle ground that a lot of lenders consider a good risk (ignoring any exploitative profit benefits from sub prime lending etc.).

The reason I think of it like this is that you run the risk of damaging your credit score (and your search rankings in the IT world) if you try to tune yourself to what lenders (or search engines) want because you will are basically firing at a target that you can only get a rough location for and (as people have found in the SEO world) it's very easy to unknowingly overcook one aspect or activity and throw yourself off a cliff face.

The best advice I've ever been given is to make the most of what you can get credit wise (i.e. don't long after credit you can't get), use it sensibly and responsibly (actually make an effort to repay it pro-actively), and don't use it for anything you wouldn't be spending on if you hadn't had it. This in theory should naturally push you into the middle ground and start opening doors.

jakesuk

Thanks for the suggestion of Flybe although its benefits are of no use to me and I already have a day-to-day card with cashback.

I have access to credit and I have never paid any interest to a lender. I was recently rejected by Virgin and Sainsburys, just not sure why. I appealed Sainsbury's unsuccessfully.

Maybe it's a sign of the recession times........

Hax

Do you have any other form of credit? Loan or HP maybe?

jakesuk

I have the 3 credit cards detailed in the earlier post. I also have a phone contract and a bank overdraft facility which is rarely used. Never had a loan/HP agreement and no black marks ever such as CCJ or missed payment. I also became a new British Gas customer 6 months ago.

I have been in current employment for 2 years and current address for 2 years.

As far as I can see I have a clean history, credit reports looked OK to me 6 months ago before the recent rejections.... I get the feeling I would have had more success acquiring mainstream cards before the economy went kaplunk.