No credit history & how many is too many applications?

CLAPTON

without seeing his SOA its impossible to tell, but on 20k a year he really ought to be building up some savings and not simply standing still with the OD...

ktb

mintymoneysaver wrote:

cOULD HE OPEN A NEW CURRENT ACCOUNT E.G aLLIANCE AND lEICESTER WHICH ALLOW 0% overdrafts for the first year? He will also get £50 for switching.
And can I just say what a financially sensible couple you sound!

Yes I mentioned that to him a while ago actually - I will suggest it again! thanks.

I certainly dont think that we are very financially sound - we do both have large debts from our student days. But I like to think that we are both getting our sensible heads on and trying to deal with it the best way possible at the moment.

ktb

CLAPTON wrote:

without seeing his SOA its impossible to tell, but on 20k a year he really ought to be building up some savings and not simply standing still with the OD...

He does have a few thousand in a couple of ISA's but flatly refuses to touch it - and fair play to him for that.

Although he hasnt done a proper SOA on paper we worked his out last night and you are absoluely right.. he should be able to build up savings no problem after his overdraft is paid off. Up to this point he hasnt really worried about standing still in his OD that much as it was at 0%, he has been enjoying living and socialing in London (which obviously isnt cheap) and saving too.

He obviously want to recify that now that they are about to start charging him interest and I have no doubts he will manage it with no probs. Having been spending lots of time on here tho recently I really resented the idea of him paying interest on his o/d if it could possibly be avoided so thought i'd try and find a way round it.

I really appreciate all your input and ideas.

YorkshireBoy

Hi ktb,

Forgive me if I'm over-simplifying the situation here, but your OH...

• is earning £20K a year ( and presumably clearing over £1,200 per month?).
• has no other debts [EDIT - didn't see the bit about the student loan] - just living expenses.
• is paying approximately £18 per month only in debit interest.

I'd have thought the overdraft would be cleared well within 6 months, without the *need* for a credit card (and BT fees, and switching deals further down the road).

Just a thought, do you have a financial association (eg joint current account or mortgage) showing on your credit reports? If so, and I mean this nicely, his applications may be being affected by your level of debt.

ktb

Hiya YorkshireBoy... over-simplify away

Nope there is no connection between us financially.

Basically we worked out last night that he could pay the o/d off in 6 months if he totally gives up spending any money on his hobbies and socialising. He has allocated himself a budget of £50 a month for those now, so everything else will go towards the debt and it really shouldnt take too long.

I have a very detailed SOA of my own and we are currently in the middle of getting all our utilities switched, doing food budgets and meal plans etc but whilst I have totally accepted giving up my social life etc in order to service my debts he really doesnt want to do that & he's not really in a position that he needs to i dont think. It was just that if he could have gotten a card and stretched the repayments over a longer period at 0% that gives him a bit more breathing space.

It was more a matter of want than need to be honest and I did want to check the impact of the rejected applications on his credit rating for the future.

UK007BullDog

Just a general comment:

Even though someone might despise CC's and Loans or hire purchases, you kind of need them to build up a good track record of yourself.

This will help once you require a mortgage.

Lenders prefer to see someone with lots of cards (and some debts) well managed than no loan history at all.

I know its weird but that is how the system works.

ktb

Thanks UK007Bulldog... yes i'm starting to realise that he needs to build up some credit history for the future. I think whatever he decides to do about his current situation he'll get the basic credit card that Barclays offer and start spending and paying it off straight away - luckily I trust him enough to do this without getting himself into any kind of trouble.

Would be upsetting to have issues getting a mortgage in a few years just because he happens to have always basically lived within his means and had chosen to avoid the credit trap! But that's just the way the cookie crumbles I guess.