credit history gone from excellent to poor!

plzhelpmesave!

Hi advice needed plz!

Dh and I did a free credit checks in the summer and we both got excellent scores (in the 900s). Hubby has a 4 credit cards and has always made regular payments on all - about £1500 on each card.

He has 2 current accounts with Abbey - his salary is paid into one and all DDs etc go out of this a/c. The 2nd one was supposed to be a separate spending account with any leftover money after bills paid, but never really put much in there! Anyway, paid a bill or something and he ended up overdrawn by £183 on the second account (which has no regular money going into it). For various reasons it took a couple of weeks to get to bank to clear the overdraft (he was working long shifts, no internet banking at the time an me heavily pregnant & sick).

Now that overdraft has affected his whole credit history. He applied for an M&S card to do some BTs and was rejected because of this one overdraft which they said came up on his credit history. Phoned M&S to explain and they agreed to give him a card but only £500 limit - has between £5-10k limit on other cards.

Contacted Abbey to see if they could remove this from his file - but they wrote back saying no. He is now trying to move bank a/c as was really frustrated with Abbey, but is only being offered a basic bank a/c - again because of this credit history. We did another credit check and this is the only default on his record.

PLEASE has anyone got any advice? We were hoping to remortgage our house as coming off a fixed deal soon, but at this rate we won't be able to do this either.

Many thanks!

climbgirl

I'm not really sure what you can do about the Abbey overdraft, but one thing that might be a problem is his number of credit cards and the limits on them. You say he has 4 cards with limits of 5-10K - so that's a potential debt he could build up overnight of 20-40K.

Banks are starting to look at this in applications now, my friend with an impeccable credit history got told by a bank that his potential credit limit (even if unused) would make a difference to an application he was making.

I got a letter from my credit card people the other day saying they were cutting my limit from £10K to £5K because they were concerned about mounting levels of personal debt in the UK. Nothing to do with me, I've never paid a penny of interest on that card (or any card), never had loans or any kind of debt.

So maybe cancel some of the cards or get the limits lowered. The way banks see it, he could go out tonight and run up 20-40k worth of debt. They'll take that into consideration for sure.

angelavdavis

I agree with climbgirl's response. Cancel any credit cards with zero balances or ask the credit card companies to lower the credit limit on cards where you really don't need such a high limit.

Also, keep a note of the amount of times you are applying for credit so you don't apply more than 4 times every 6 months.

I have increased my credit rating to excellent this way.