Does this mean I have now got a reasonable credit record?

ATRO

Hi All,

For the last few years I have had a nightmare whenever I needed credit, I had a default dropped off my file in June last year and had to fight tooth and nail to get a mortgage (we did eventually).

Anyway, in July I applied for a Cap One Classic and was accepted with a £1k limit, still though my own bank had me down as not pre-approved for anything, couldn't understand it.
I have been paying the CC balance in full every month and recently my limit was raised to £2k so tonight I rang my Co-op armchair banking and I am pre-approved for a loan up to £19900 and a CC with a limit of £7.5k and 11.9% apr.

Whilst it obviously means my record with Co-op is well on the road to recovery is this likely to mean I would get accepted for mainstream cards in general now?

Do I take their card and close the Capital One or would it be better for my credit file to use both?

izools

Certainly it does sound like you have a good credit rating now.

Although Capital One Classic is very loosely scored and available to those even with CCJs and Defaults, they typically give out small limits. 1K starting raised to 2K is very impressive, for that card. It shows you have a good affordability rating and run the account very well.

Although you have a banking history with the Co-Operative bank, they will also know what goes on on your credit file. They will have based your loan limit and credit card limit either on the monthly feed they get from Experian, or a full credit search.

Either way it will have taken into account your credit file as well as your account conduct.

Certainly take their card, but one thing to be careful of is to ensure your total credit limits (added up over all your cards) is well under half your annual income.

This will ensure any future creditor you apply to won't be weary of your Limit to Income ratio. I.e. if you have 9.5K of available credit on a 20K salary they may not want to lend you much, but 9.5K limits against say a 30K salary isn't so bad and future limits should be reasonable.

As long as your income is sufficient, keep the Capital One card open. As it is now an older account, leaving it open shows stability, which is a big plus in terms of credit scoring.

Well done, and good luck with your future endeavours :beer:

EDIT: On which statement did Capital One increase your limit? Was it the 4th one, or further down the line?

jonesMUFCforever

So don't mess it up again !!!!!!!!

ATRO

Cheers for the comments :beer:
My salary is £26k atm so I'm quite a bit under half.

Yes it was my 4th statement when I got the increase, if people have the facility to pay in full I would definitely advise the classic to rebuild, the online system is nice and easy to use and I haven't had a problem with them at all.

izools

I, personally, would consider accepting the Co-Op card but asking them to reduce the limit to 5K or closing the Classic.

9.5K is still quite a lot of credit to take on board for someone on 26K. Not a grotesque amount, but still could put off some of the most stringent lenders.

End of the day, lower your debt to limit, debt to income, and limit to income ratios, the better.

ATRO

Cheers for the advice, think I will hang on to the Cap one and ask Co-op for the £5k as you suggest.

Thanks again!