Sons Credit History

Dragon_Lady_3

I'm not sure that this is the right place post but here goes.

Can someone please give me an answer. My son is 20, he has had a savings account since 14 years old, and a current account since he was 16 when he started work. He has a cheque book [never used] and a cash card. The cash card can only be used to withdraw cash from the hole in the wall.

He has asked the bank if he can have a 'switch' debit card. They have told him that because he has no credit history they cannot give him a debit card as this acts as a cheque guarantee card also. Their theory is that if they give him a card then he could write out cheques with the card and then he could run up an overdraft.

I have always taught him, that if he wants something, to save up and then buy. So he has no debts, no credit cards, no hp etc.,

How can someone build up a credit history without getting into debt in the first place? It seems a 'catch 22' situation to me.

Thanks in advance

Very confused mummy

Moonbeam

Does he work?

If so does he have regular credits going into the account?

Has he tried a different bank?

Clive_Woody

Dragon_Lady wrote:

I'm not sure that this is the right place post but here goes.

Can someone please give me an answer. My son is 20, he has had a savings account since 14 years old, and a current account since he was 16 when he started work. He has a cheque book [never used] and a cash card. The cash card can only be used to withdraw cash from the hole in the wall.

He has asked the bank if he can have a 'switch' debit card. They have told him that because he has no credit history they cannot give him a debit card as this acts as a cheque guarantee card also. Their theory is that if they give him a card then he could write out cheques with the card and then he could run up an overdraft.

I have always taught him, that if he wants something, to save up and then buy. So he has no debts, no credit cards, no hp etc.,

How can someone build up a credit history without getting into debt in the first place? It seems a 'catch 22' situation to me.

Thanks in advance

Very confused mummy

This might be a silly question, but he currently has a cheque book but no guarantee card so I guess he can only send cheques through the post, surely then he could still run up a debt (althought the difference would be he would not have offered a guarentee card when writing the cheque)?

Astaroth

Yes it is the normal catch 22 of no experience but cant get experience because you have no experience.

Generally you basically have to find someone who is willing to take a bit of a risk of being the first one. If your son is otherwise a solid bet (long term in the same full time job with a decent salary, lived in the same property for more than 3 years, been with the same bank for more than 3 years etc) then normally "someone" will take the risk.

I would normally recommend approaching his own bank as he is at least a "known quantity" with them. Short of that you have the other low value credit such as contract mobile phones or credit cards with exceptionally high APR - dont have to pay interest if you clear balance in full each month and this will build a history for him

november

I would say try another bank. My daughter has had her bank account since she was about 13/14. She started off with a cash card only then when she was 16 they asked if she wanted a debit card.

She is now nearly 18, full time college with part time job and has had her switch card for a while.

My son, 13, is at the 'cash card' stage and I pay his allowance into his bank account.

I don't understand the 'building up a credit history' need for some banks for a debit card when you have been their customer for a while. Its not like its a credit card

Dragon_Lady_3

Thanks for your imput folks.

The bank he his with is HSBC :mad: . He has tried NatWest but they even said that he needs to have the account there for 6-12 months with his salary paid in regularly before they will issue a debit card.

He even has his mobile phone on P as YG so he knows he is only spending what he can afford.

Will have to get him to trawl round all the banks on his day off.

Oh well trials and tribulations of growing up I guess.

jonesMUFCforever

Tell him to try LTSB. If he passes the credit score then he will get at least a 2-1 Debit control card.
This does not come with cheque guarantee but can be used as Visa debit card and cashpoint card.

november

Dragon_Lady wrote:

Thanks for your imput folks.

The bank he his with is HSBC :mad: .

That makes no sense That IS the bank my daughter is with. She is 17, a student, and therefore not working full time

I know she has a switch card and she didn't even ask for it - it was offered!

She hasn't got a cheque book though as far as I know (not offered and she has never asked). If its the cheque book and card thats the problem and he doesn't need the cheque book can he get a switch from somewhere if he doesn't have a cheque book?

heather38

what about asking for a solo or electron card instead of a switch card as you can't spend more than is in your account on these cards? worth asking again or try ringing the bank call centre instead of going in branch they may be more accomodating

newfoundglory

I would first ask HSBC to review their decision - your son has a right for the credit scoring decision to be made by a human being and not a computer for one - secondly, you can ask them to pass this decision onto their underwriters.

If this fails, then i recommend changing banks. Someone suggested Lloyds TSB - definitely a good idea. Lloyds issue visa debit cards without cheque guarantee. Barclays are able to issue visa debit cards with £50 cheque guarantee facility rather then £100 which may be another option to consider as this halves potential credit from £3,000 to £1,500 and makes them easier to obtain.

A bank would usually use its own "internal" scoring system when upgrading customers - thus avoiding the catch 22... but it looks like HSBC doesnt want to play ball here. I got an interest-free overdraft on my Lloyds TSB graduate account about 6 months ago. I've had the account about 4 years. They gave me £1000 after a 5 min phone call, without asking any questions or even searching my credit file!