Rebuilding Credit

Stevieb_2

Well I have been lurking round here now for what seems like years, hell I even have the "The Money Diet" book!

I'm looking for some practical advice.

What's the best way to rebuild my credit rating? As of today I am totally debt free, I was gifted a lump sum and I'm NEVER getting back into debt. Cards cut up, the lot.

However I stopped to think, is it prudent to keep the longest standing card to use for rebuilding credit? I know it seems a daft idea, but without credit, you surely can't rebuild it? Keep an emergency card for essential car repairs, the odd tank of petrol here and there to show regular payments etc.

Are there any other practical suggestions?

Thanks guys

Steve
:T

SarahNeedle1872

I would also be interested in this for my OH. He is debt free now (just me to go!) but has a terrible credit rating. Would it be worth getting a card with a really high interest rate (i.e Capital One Classic) and putting a token gesture £10 a month on it, as Stevieb said? Or are there better ways to improve credit ratings?

tom188

Get a vanquis card or similar if available to you. set up a direct debit to pay the full balance and spend a nominal amount every month. Then give it a couple of years and hopefully things will look brighter for you.

Stevieb_2

But is it worth re-applying for ANOTHER card? Especially if you fail the credit check which will only damage your history further? Surely it's better for your credit rating to keep a long standing card that has a relatively good history?

Apologies if this sounds daft, but I just want to make sure I don't make any mistakes this time!

tom188

Oh yes if you already have the card, keep it, set up a full payment direct debit and do as i suggested previously. No point getting any more cards if your not planning to fill them with debt is there...

Stevieb_2

Spot on cheers!

Are there any other ways you personally feel are useful? Or is using a credit card SENSIBLY the best way?

Appreciate the help.

tom188

Also unfortunately it is a breach of site rules to have that link in your signature, even though its only to your personal site.

tom188

I think generally from a credit point of view just payments on a regular basis will improve your report no end. Just make sure they are always paid off in full and you dont feel tempted to get back into debt again.

If you have more than one card it may even be better to put the same approach to all of them, as it shows you can handle more credit efficiently. Set low limits on them just in case.

Stevieb_2

Fair enough.

So do things like mobile phones count towards credit ratings? Showing regular payments on a credit service like a contract.

Or is that a different ball game?

PS, won't let me edit my sig from previous posts sorry guys about the url rule.

tom188

Generally yes. It all depends on whether they report or not.

Have you had a look at your credit report? - this will show you all the companies that are currently reporting and have reported over the past six years. You can get them from Experian, Equifax, Call credit for £2 each. Alternatively sign up for the 30 day free packages from experian and equifax to have a look, just remember to cancel within that period or youll get charged a lot of money.

And dont get suckered into the £5 credit score rubbish. These arent worth the paper they are written on.

tom188

PS the links have disappeared from your previous posts - i think when you change your sig it updates all your previous posts automatically.