Post IVA Credit Rating

bloc75

Hi,

I completed my IVA in the summer, 5 years of payments - so as far as I am concerned it was settled. I know I need to probably hound a few creditors to clear my file, but I also know they are entitled to keep me on file for 6 years from when I defaulted.

So anyway I thought I would test the water with my credit rating. Not because I am interested in drumming up more debt, but because I may want to get a mortgage next year, plus I have a well paid job now, so I would like to know that I am no longer seen as a criminal to some companies.

Right, I tried to get a £500 finance for an iPad, it was through Barclays Finance, who I have no bad debts with in the past. It got rejected. Ok I thought, its fair enough.

So 2 weeks back I ordered my Credit Report, and it came back with a rating of 900/1000 which according to them is Good.

I also noticed two creditors still had the debt on file, which I expected. What I didn't expect was the 900/1000 and a rating of Good.

What does it mean exactly? If I say applied for a credit card I would get it? I'm just confused.

Just want to know what my standing is in the financial world.

FoggyBrain_2

Hi. Any defaults should be dated prior to or on the date your IVA was accepted. If not, write to the companies and ask them to amend the date. This will mean on the 6th asnniversary the whole thing will drop off your file, and you will have a clean record.

The credit score is basically meaningless. Every lender applies there own criteria, and acceptance or refusal seems to have no bearing on the score.

bloc75

Really? then how is anyone able to build up a decent credit?

FoggyBrain_2

It's the credit RECORD: past behaviour and a good RECORD of payment history that counts. The numbers on the scoring mean very little, as each lender has their own preferences as to what they deem acceptable, or not.

So, you need to build up loads of green ticks, not numbers.

bloc75

Right and where are these green ticks supposed to be?

FoggyBrain_2

OK, first, make sure the defaults are all correctly dated, so they drop off at the right time. Then, you can collect green ticks from things like mobile phone contracts, properly run bank account, maybe even a vanquis card, as long as you pay it off in full every month, as the interest is horrendous. An empty credit report is as bad as a defaulted record.

bloc75

Oh I see, but how can I get credit to pay it off? and are these green ticks imaginary ones?

FoggyBrain_2

The green ticks are just good payment records. If you have a mobile phone on contract you will be getting a good mark every month you make payment on time, same with vanquis card. You will have a better chance of getting them after the IVA has dropped off. Your record will be like when you left school and got your first job, you start slow and build up. Remember though, you are not after credit (that's what got you here in the first place), so keep payments small and pay back all balkances every month with out fail.

bloc75

Ok, well I want a mortgage, so that is the point of building up decent credit. But I am struggling to see where I can see these green ticks, or do I just say, well I paid my bill on time, so therefore I am getting green ticks.

In short there isn't a document that shows this.

FoggyBrain_2

For instance --- when you take out, say, a vanquis card, or mobile phone contract, they will report your payment history, as it grows, to the credit reference agencies. Every payment made on time and in full will give you one of these "green ticks", it is those that the future lenders will be looking at.

The "document" that will show future lenders your good payment record will be your credit report. On this will be a list of your new "lenders", along with a report of how you conducted the account.

bloc75

Right, but there is not going to be a physical tick is there? this is what I am getting at. I have my report, I have had little bits of credit like phone contracts recently, but I am not seeing green ticks, so I was just curious as to what to look out for.