Will getting a credit card help my credit rating?

swyer

Sorry for my financial ignorance but I was wondering if anyone could help me.

I’m 26 and looking to get a mortgage in the future but am worried I won’t be able to get credit as I don’t have much credit history.

• I don’t have a credit card
• I’m currently not paying any utilities bills directly as I live with a relative
• I’ve been in the same job for 5 years
• I’ve got savings
• My only direct debit is a phone contract

I’m financially secure and have never needed a credit card, but someone recently told me I’d struggle to get a mortgage as I don’t have a record of ‘good credit’.

Is this accurate and would getting a credit card (and paying it off regularly) help this? Please help!

Tixy

A lack of credit can be just as much as a problem as a poor credit history.
Getting a credit card and using it regularly will certainly help.

First place to try would usually be your own bank. If they won't offer you one then you may need to try a sub-prime lender to start - have a read of this article http://www.moneysavingexpert.com/loans/credit-rating-credit-score#improve

ironlady2022

Definitely look at getting a credit card, as long as you spend, pay in full and on time every month you will pay nothing extra unless you pay for the card annually. This will build up your credit rating and increase your chance of getting a mortgage with better rates too.

swyer

Thanks so much to both of you!

I've completed my application form through my current bank, so fingers crossed. Set up a DD for the full sum each month and I've never been one to spend beyond my means, so I can't see that I'll lose out in any way.

Also ran an Experian report as frame of reference so I can see if it's changed much in a year's time.

ironlady2022

That's great bear in mind although you have filled in DD to pay in full every month this may not be set up in time for the first payment. It will say on your first statement, hate to have you get a late payment!