How to Build Credit History

mankarni

Hi I was wondering what really counts as a Credit History..
I have been paying my credit card in Full every month since I got it in March 2012. Will this be considered as a credit history. Because paying in Full; I have not carried the Credit with Interest.But with free credit month on month..
In Essense I do not have a history of taking money on credit and paying it back in instalments(Like Mortgate).

Do Banks/CCC consider this as a Good Credit history. Or I should rather not pay in full carry some balance and pay it off later, which will build a better credit history in the eyes of the lenders ?

Any comments on this Subject Are welcome. How to build a Good credit history for Novices.

[Deleted User]

mobile phone?catalogue account?

CLAPTON

using a credit card regularly; wait until you get the statement and pay in full before the due date is fine to build a credit history (the CC company make money from the retailer on every purchase).

but it takes a little time

susan47

mankarni wrote: »

Hi I was wondering what really counts as a Credit History..
I have been paying my credit card in Full every month since I got it in March 2012. Will this be considered as a credit history. Because paying in Full; I have not carried the Credit with Interest.But with free credit month on month..
In Essense I do not have a history of taking money on credit and paying it back in instalments(Like Mortgate).

Do Banks/CCC consider this as a Good Credit history. Or I should rather not pay in full carry some balance and pay it off later, which will build a better credit history in the eyes of the lenders ?

Any comments on this Subject Are welcome. How to build a Good credit history for Novices.

Paying in full is good, that's good money management avoiding debt. Do you have a mobile phone? Council tax? You must have bills you pay regularly? It all goes towards showing you are a good credit risk. I used to think that not owing money meant you had a great credit record but that's totally wrong, of course. A credit record means just that, you have to have a history of borrowing money and repaying it on time. I found that out when my son discovered he had a very poor credit rating despite never borrowing anything - he thought that credit cards were bad and encouraged spending you couldn't afford. In the end he realised he had to get some and use them or he'd never get a mortgage! So he got a couple of credit cards and started to build up a history, and then he got a mortgage ok. It is strange though that in order to show you are good to pay for something, you first have to show that you don't have the money to pay for it...Money in the bank counts for nothing, it seems.

[Deleted User]

jameswilder wrote: »

leaking out will be risky

This and your other spam reported, Jimbo.

guesswho2000

jameswilder wrote: »

leaking out will be risky

:spam: reported, along with your other fifteen pointless posts

Anthorn

On the time basis you're probably looking at a minimum of two years for it to be considered a reasonable history. But it depends on what the lender thinks is reasonable: One lender might consider 1 year as reasonable whereas another might want the full 6 years.

Whether you pay off the full amount every month or a reduced amount or indeed the minimum payment again depends on the lender and what information is passed to the CRA. For example, last month Vanquis additionally started sharing the payment with the CRAs which means that potential lenders can now see both the balance and the payment for a given month. Say for example you're clearing the full balance on a credit card, you apply for a credit card and that bank or company wants new customers who are likely to pay interest you're unlikely to get that credit card. On the other hand if the company likes customers who pay off the balance every month you're in with a chance. The other variable which is likely to be taken into consideration is how long it takes you to clear a balance.

In conclusion it all depends on the lender and one is unlikely to have the same criteria as another.

ChopperST

Anthorn wrote: »

For example, last month Vanquis additionally started sharing the payment with the CRAs which means that potential lenders can now see both the balance and the payment for a given month.

The majority of lenders and CRA's already do this, it is very easy for the lenders to see your balance and payment history.

Sounds like the OP is doing all the right things. Have a credit card and use a DD to pay it off in full every month. Make sure you are on the electoral role and dont keep moving around and changing addresses will show you are a "good" credit risk.