Hi all! (First Post)

whatatwit

Whilst you still have the cards, thay are classed as available credit, even if they at a zero balance.
Get them paid off and cancelled, possibly just keep one for emergencies, but lower the limit available.

Red_Man_2

Will cards let me lower the limit to whatever i want? e.g. £20 (just to up my credit rating?

whatatwit

I think £20 is a bit of a waste of space, but as I understand it, you can ask to have your limit reduced to a level you are happy with.

It won't improve your rating as such, just reduces the amount of available/agreed credit.

The best way to 'improve' it, is to keep up with payments.
As you are paid weekly, do you make weekly payments?

Red_Man_2

No, monthly payments.

So will keeping all 3 cards and paying them regularly and on time improve my credit rating more than keeping one card and paying it regularly and on time?

CLAPTON

the really important things for a good credit rating are:

on the electoral roll

no bad things (missed payments, etc)

and one or more credit payments regularly made

whether it's 1 or 2 or 3 CCs makes very little difference, the important bit is that you always pay and always on time.

for a mortgage the important things are :
good credit record of paying your bills on time
affordability (size of mortgage in relation to income)
size of deposit
but they will reduce what they will lend if you have debts.

robnye

at the end of the day , you need to rain in your spending, a couple of months should be enough to put your cards back under the limit if not paid of.......
cant you change to going out every other weekend and stay in the other 2, each month this month will give you approx £160 extra to throw at your debts..... get into good habits now..... and they will set you up for life...

angelavdavis

Hi Red_Man and welcome to the site.

I have been reading the post so far - Clapton has been spot on outlining what you need to do.

You need to realise how mixed up your thinking is here:

Cut up the cards to stop you being tempted to spend on them again.

Pointless saving for a mortgage - you don't stand a chance if you can't stay within your credit limit as your credit report will be rubbish. If you can't manage your credit cards properly - why should a bank lend you £200k?? You need to discuss with your girlfriend, put the savings on hold and agree to withdraw a set amount to clear the debts. This will enable your credit report to improve itself while you throw £150+ what you would have been using to pay off debt per week on your mortgage.

You are frittering your salary every month. Its good that you are now keeping a spending diary.

If you think things are bad now, see how you will be once you add the following onto the list every month:

400 your half mortgage (not sure where you live so no idea house price level)
40 y/h council tax
25 y/h water bill
25 y/h gas bill
20 y/h electric bill
10 y/h contents insurance
20 y/h house insurance
10 life insurance (for mortgage)
10 y/h telephone/broadband

That's without furniture, bathrooms, kitchens, refurb, etc.

I make that 560 total

Tough pill to swallow, but this is the reality.

Red_Man_2

Yeh as i said i do agree in principle with what everyone is saying about the savings.

I think I'll just stop my monthly payments into it but not draw any money out.

Just been talking to my OH and weve agreed to cut going out to once a month. just for a few months atleast, its too cold anyway :P

I'm gonna set myself up a signature now anyway so you can all see my progress over the next few months, thanks everyone for advice its been a real help.

One more question regarding mortgage/credit rating.

Because i've been missing payments/making late payments for over a year now, how badly has this damaged my credit rating?

If i get back on track by March 07, and keep making payments steadily until August 09, how much will that have restored my credit rating by? i realise you cant give me exact ammounts without knowing my credit score, but, ballpark?

Thanks again.

CLAPTON

get hold of your credit records and see whats actually there

whats done is done and although you need to know what the situation is the only real action you can take has already been discussed

in any event there is no such thing as 'your' credit score as such, each potential creditor have their own lending criteria... so one CC may reject you and another will accept you.

if all you have is late payments, then these slip down the visablity scale pretty quickly and you should be alright after a year.

mortgage companies have different criteria to CC. so it might seem strange but a CC may reject you but a mortgage company may accept you..the difference is that their loan is secured on your property..so things like size of deposit and % of loan to value are very important.

Red_Man_2

By the time we're ready to purchase we will deffinatly have atleast our 10% deposit, so will that go a longway to helping? we'll be planning on borrowing around £115,000 on top of that.

My girlfriend has no bad debts, student loans, credit cards, overdraft. Nothing really. shes paid all hers off.

And im determind for mine to be at a point that they dont want to hinder our chance of getting the mortgage/house we want.