Your Credit Rating: How it works and How to improve it Discussion Area

jimbo26

tummydoor685 wrote: »

Hi All Money Savers!!!

Having tried the 30 day free credit report trial & obtained my report & score...which is a healthy 967 out of a possible 1000 - with a rating of "Excellent" i am curious to know why i am unable to obtain any 0% credit card deals?? If im deemed a very low risk then why am i finding it so tuff to move my existing credit to a 0% deal?

Any ideas anyone??

Thanks

I have seen lots of posts like yours, and come to the conclusion it's a waste of money.

danthemoneysavingman

Bomopu wrote: »

I've put the whole story here but the last paragraph has my question if you don't want to read the lot.

Until last last August my credit record was excellent as I had always been very careful not to let
myself go into arrears on my loans or credit cards (total £16000)but I was struggling to make ends meet and slowly reaching the limit of my overdraft.

Before I knew of MSE I was looking for debt advice on the internet and looked at a debt management company (Abacus Finance) who called me and explained that they would be able to negotiate a lower interest rate with all of my creditors and by making a single payment to them they would spread the cost across my creditors (I'm sure most of you know how they work). I worked out I would be paying less each month and so agreed.

They told me not to communicate with my creditors and refer all the letters to them and so I did but it took them so long to make the first payment (3 months) that they had all gone 3 months into arrears and one credit card defaulted. I immediately cancelled my agreement with Abacus (and am still fighting to get the £260 they owe me back) and brought my payments back up to date (although I am having to make agreed overpayments on my loan for next 6 months to get back on track).

My experian credit record shows my Egg credit card as having defaulted and I wondered if there is any chance (or even if it is at all possible even if they wanted to) for Egg to remove the defaulted mark on my record. I have written a letter to Egg explaining the mistake I made with Abacus and I was hoping with my payment record prior to September 07 that maybe they would? This has really upset me because I have always been careful to keep a good rating and it has all gone wrong just as my partner and I are to get a house together and will need to find a mortgage.

hi, not sure whether it'll help or not, but you should put your explanation in a notice of correction at the bureaux. at least then it has to be reviewed by any lender before they make a decision, you may find a sympathetic one (though i grant this may be unlikely? sorry )
egg will not change the records as you did indeed go into arrears with them - but again, worth the ask if you explain what happened... suppose one should never say never.
good luck with abacus

danthemoneysavingman

jimbo26 wrote: »

I have seen lots of posts like yours, and come to the conclusion it's a waste of money.

i don't think a FREE trial can be a waste of money!!

and people, stop thinking the score is out of 1000, it isn't. as i've said before, more like out of a maximum around 1200.
not that this makes any difference.
why do people think its out of 1000????? anyone?

CannyJock

danthemoneysavingman wrote: »

iwhy do people think its out of 1000????? anyone?

I blame it on decimalisation.

Can't beat a good old empirical 1200 maximum.

danthemoneysavingman

inmypocketnottheirs wrote: »

The credit score you have been given is totally meaningless. It is just a tool used by the CRA's to squeeze extra cash out of punters by appealing to their sense of vanity.

There is no such thing as a credit score.

Each individual lender has their own method of assessing their lending criteria. It is them and only them that decide what products to offer to who.

To say this is wrong, yet people still keep saying it.

The credit score will underpin MOST lenders decisioning, but is by no means the only thing they look at. By this i mean it has a fairly high influence over the credit score you'll get at institutions.

A score over 800 (say) gives an indication that you're a reasonably good credit risk, but your profile vs. that of their customer base / typical applicant profile / profitability criteria will drive how you'll be rated by an institution and hence your likelihood of receiving their product.
There's many other possible behavioural dimensions they will also consider.

danthemoneysavingman

JohnDocherty wrote: »

I blame it on decimalisation.

Can't beat a good old empirical 1200 maximum.

. :rotfl:

sebbelcher

Fixing my credit rating.

I've been refused credit a number of times now, it's seriously beginning to affect my lifestyle, I'm a young professional and I'm driving around in a clapped out '94 Clio because no-one will give me credit to buy a new car!
I've done an evenings analysis on my credit worthiness and I've identified the following problems, I'd appreciate any advice on fixing them.

1. I've moved house a LOT in the last 4 years because I was a student, now I'm living at my parents again. A friend told me he never tells companies about his student digs and just says he was living at the family home for the entire period. This was corroborated the other day whilst I was filling in a CRB check, the CRB advisor told me to just put my parents address as I had never really moved away, he said it was like people who go away on business and rent property for several months, they never really 'move house'. So should I be saying I was at home the whole time?

2. I'm not on the electoral role at home. I was taken off when I voted in local elections in my Uni city. Obvious fix to this one, but how long does it take to reflect in my credit score?

4. I missed a few credit card payments whilst struggling as a student. Probably about 5 in total, and for a period I was on a special arrangement but that ended fairly quickly, I haven't missed a payment in the last two years and I've recently cleared the balance. Should I close the account?

5. I 'defaulted' on £144 of mobile contract according to my credit report, except in reality I didn't. Long story short, I took out a contract on an expensive phone with insurance included (Orange with Orange Care), 6 months later the phone broke, tried to claim on the insurance, they refused saying expensive phones like mine weren't covered by the policy. I had endless correspondence with them about how the insurance was sold to me with the phone and eventually they blamed the retailer, who of course denied any wrong doing. I went around in circles between the two for several weeks before I got so angry I just cancelled the direct debit and got a new contract elsewhere. They chased me for the 'debt' for a while and eventually I got them to agree that I should not have to pay, so the balance is marked as 'settled' on my credit file. However the record of the default is still there, I've asked Orange to remove it but they say they don't have the ability to edit peoples credit files.
Where can I go from here?

6. I opened a new bank account when I started my job, they have made an entry on my credit file, but haven't supplied an data, so the 'Payment History' is showing "UUUUU" which according to Experian's scheme means:

The lender has not been able to give the account a status for this month. This may be at the start of the credit agreement when the lender is allowing time for the account to be set up; when the customer has received the goods but payment is not due to start immediately; when there is a dispute over the payments due or the goods received; or when the account is not being used.

This is tripe! I don't even have an overdraft facility with them, my account is used and the balance is always positive. I can't help but think 'U' business this is viewed negatively by credit scorers.

7. According to my credit file I have two credit cards with the same company! I don't. One of the entries is up to date and correct but the other is 'stale' and is showing details from 2 years ago, not sure how this can have happened, the card provider has been most unhelpful saying they have no record of 2 accounts in my name. What can I do?!

Cheers!!!
Seb.

fatpony

Hi
My husband and I had numerous debt issues over a period of about 6 years which resulted in us defaulting on our high rate 'especially for those with poor credit ratings' mortgage, credit cards and utilities over the last 18 months of that period. We kept all concerned in the loop all along, and a year ago we sold our house paying off the mortgage, credit cards, loans etc etc, which left us with nothing.

We have now been renting for a year, and really want to get back on the property ladder.

Can anyone tell me how quickly your credit rating repairs, as we have no credit cards etc to rebuild our rating, and have just been 'keeping our noses clean' for the last year? We really want to apply for a mortgage, but are a little apprehensive as regards our past.

inmypocketnottheirs

sebbelcher wrote: »

Fixing my credit rating.

I've been refused credit a number of times now, it's seriously beginning to affect my lifestyle, I'm a young professional and I'm driving around in a clapped out '94 Clio because no-one will give me credit to buy a new car!
I've done an evenings analysis on my credit worthiness and I've identified the following problems, I'd appreciate any advice on fixing them.

1. I've moved house a LOT in the last 4 years because I was a student, now I'm living at my parents again. A friend told me he never tells companies about his student digs and just says he was living at the family home for the entire period. This was corroborated the other day whilst I was filling in a CRB check, the CRB advisor told me to just put my parents address as I had never really moved away, he said it was like people who go away on business and rent property for several months, they never really 'move house'. So should I be saying I was at home the whole time?

2. I'm not on the electoral role at home. I was taken off when I voted in local elections in my Uni city. Obvious fix to this one, but how long does it take to reflect in my credit score?

4. I missed a few credit card payments whilst struggling as a student. Probably about 5 in total, and for a period I was on a special arrangement but that ended fairly quickly, I haven't missed a payment in the last two years and I've recently cleared the balance. Should I close the account?

5. I 'defaulted' on £144 of mobile contract according to my credit report, except in reality I didn't. Long story short, I took out a contract on an expensive phone with insurance included (Orange with Orange Care), 6 months later the phone broke, tried to claim on the insurance, they refused saying expensive phones like mine weren't covered by the policy. I had endless correspondence with them about how the insurance was sold to me with the phone and eventually they blamed the retailer, who of course denied any wrong doing. I went around in circles between the two for several weeks before I got so angry I just cancelled the direct debit and got a new contract elsewhere. They chased me for the 'debt' for a while and eventually I got them to agree that I should not have to pay, so the balance is marked as 'settled' on my credit file. However the record of the default is still there, I've asked Orange to remove it but they say they don't have the ability to edit peoples credit files.
Where can I go from here?

6. I opened a new bank account when I started my job, they have made an entry on my credit file, but haven't supplied an data, so the 'Payment History' is showing "UUUUU" which according to Experian's scheme means:
This is tripe! I don't even have an overdraft facility with them, my account is used and the balance is always positive. I can't help but think 'U' business this is viewed negatively by credit scorers.

7. According to my credit file I have two credit cards with the same company! I don't. One of the entries is up to date and correct but the other is 'stale' and is showing details from 2 years ago, not sure how this can have happened, the card provider has been most unhelpful saying they have no record of 2 accounts in my name. What can I do?!

Cheers!!!
Seb.

A combination of factors here.

Numerous moves in a four year period does not give a lender an impression of security.

You are not on the electoral roll. This means that lenders can not verify that you live where you say you do.

Missed payments are not a good indication of how you run your credit facilities. Closing the account will not remove the data that the agencies hold.

A default notice is as bad as a CCJ. Once a default notice has been issued it stays on your file for six years from when issued. A default notice basically makes you a financial leper. However, all is not lost. Have a look through this website: http://www.learnmoney.co.uk/credit-cards/remove_default_notice.html where you can see how it is possible to get a default notice remove. I know it works because I did it. Many lenders (including service providers like Orange) throw default notices around like confetti and they may have not followed the correct legal procedure. Orange are the only people who can remove the default notice. If they deny this they are liars.

I am not sure how 'u' grades are viewed by lenders. TBH I think that they will not take them in to account when assessing you for credit, but it would be worth asking the agency whether this has a negative impact on your file.

If the lender that shows you have two cards is saying you don't write to them including a copy of your credit file and ask them to explain your entry. You can also write to the agency explaining you have been in contact with the lender and they have not given you the information that you require. The agency will then put a notice of correction on your file saying this information should not be relied upon when deciding to give you credit, whilst they wait to hear from the lender. If the lender does not reply to the agency, then the agency will remove the queried entry after one month.

HTH and good luck.

Herbee_2

Dear Ronaldo175

I am in the same situation (also alliance and leicester) and was thinking of applying for the capital one card. Have you had any joy?