Using Credit Card to Rebuild Credit History

ian_h

My OH has just been accepted with Vanquis for one of their 59% APR credit cards which will be used to solely rebuild a decent credit history.

We're using the card to buy food and repaying in full each month, so the APR isnt a problem.

We've read that to look "attractive" when other lenders will eventually search you should aim to use no more than 2/3 of the available credit each month, so this is what we are doing.

Couple of questions though:

1. If we pay down the card before the statement has been produced will this result in them reporting "nil" usage to the credit reference agencies rather than the desired 2/3 usage?

2. As OH has previously had problems with credit, once the credit file is repaired will the banks who OH was previously with be best avoided or will there records clear after 6 years also?

Thanks in advance

jonesMUFCforever

1 My advice is pay what is owed on the statement making sure not to go anywhere near the limit.
2 If he leaves a debt with a bank the records with the CRA 's will be shown as cleared but banks internal records will be there for a long time. It may be best to avoid this bank for the time being.

Consumerist

ian_h wrote: »

1. If we pay down the card before the statement has been produced will this result in them reporting "nil" usage to the credit reference agencies rather than the desired 2/3 usage?

You should pay the card balance in full after the statement date and by the payment's due date.

If you pay off the entire balance before the statement is produced then your outstanding balance on each statement will be zero. This will look as though you are not using the card.

book12

I would suggest setting up a direct debit, so it will take the amount automatically.

book12

Consumerist wrote: »

You should pay the card balance in full after the statement date and by the payment's due date.

If you pay off the entire balance before the statement is produced then your outstanding balance on each statement will be zero. This will look as though you are not using the card.

I don't have a credit card yet, but soon will.

Assuming the OP is paying the balance manually instead of DD, I was thinking about if the OP paid the card balaince in full on the actual due date, instead of after the statement date, wouldn't that be better?

Consumerist

book12 wrote: »

Assuming the OP is paying the balance manually instead of DD, I was thinking about if the OP paid the card balaince in full on the actual due date, instead of after the statement date, wouldn't that be better?

You can't always be sure that a payment will arrive on any given date. You can, however, ensure a payment arrives before a given date. The consequences for missing the due date are not worth the gamble.

Payment by DD is the best option because the payment is usually taken on the due date or on the next banking day without the risk of a late payment.

aldredd

book12 wrote: »

I don't have a credit card yet, but soon will.

Assuming the OP is paying the balance manually instead of DD, I was thinking about if the OP paid the card balaince in full on the actual due date, instead of after the statement date, wouldn't that be better?

No. As Consumerist mentioned, just because you make a payment on due day, it often won't clear into your account for 2-3 working days. I've been caught out by this one or twice in the past. This will be viewed as a late payment.

KingElvis

Treat this card like live ammunition, never disrespect it and never leave anything to chance.

A running balance on this puppy would be a thing of sheer blood curdling TERRRRROR