NOOB with a Credit Card

McClane54

Evening ladies and Gentlemen

Ive just been accepted for a Vanquis Credit Card with £500 linit

Ive never had a CC before and would like some help or advice on how to use it, The only real reason I applied for one was to build my credit score

Any advice would be most appreciated :T

SCO

McClane54 wrote: »

Evening ladies and Gentlemen

Ive just been accepted for a Vanquis Credit Card with £500 linit

Ive never had a CC before and would like some help or advice on how to use it, The only real reason I applied for one was to build my credit score

Any advice would be most appreciated :T

Set up a direct debit so you dont get a late payment fee and marker.

Pay off in full each month.

Only use it for spending you would have made anyway, if you buy something you cannot affored to pay off you will get hit with sky high APR with vanquis.

dresdendave

Treat the card as an alternative method of paying for things rather than an additional source of funds.

Therefore only buy things you can afford to pay for and would have bought anyway.

Make sure you stay under your limit and when you receive a statement pay off in full every month before the due date. Some will advise setting up a DD for paying your bill but that is down to individual preference.

Never use it to withdraw cash or cash type transactions such as gambling or purchasing foreign currency.

Follow these rules and you will never pay a penny in interest.

McClane54

Hi

Thanks for the responce, say one month i pay for petrol to the sum of £50

and i have a direct debit of say £60 to go in each month to cover purchases, does the credit card then become £10 in credit? does it like this?

I get paid the 21st of each month

dresdendave

You are not supposed to have a positive balance on a CC.

Just pay off the total amount on the statement in full. I emphasise in full, even 1p short will mean you incur interest.

If you are setting up a DD it should be for full payment rather than a fixed amount, as your spending is unlikely to be exactly the same amount every month.

jennifernil

No, set up a DD to pay the full balance, not a set amount. The CC provider will take the correct amount each month.

McClane54

jennifernil wrote: »

No, set up a DD to pay the full balance, not a set amount. The CC provider will take the correct amount each month.

tidy! never knew that, thanks!

McClane54

dresdendave wrote: »

You are not supposed to have a positive balance on a CC.

Just pay off the total amount on the statement in full. I emphasise in full, even 1p short will mean you incur interest.

arghh ok, say I only spend a tenner in the month, and i didnt pay the bill off, but paid it off the next month, what happen then?

sorry for the noob questions

paulofessex

Approx. £12 in charges if you made no payment whatsoever

McClane54

woooow over double the amount, ok, thanks

Paul_the_Painter

Not to forget a missed payment notification on your credit file, so the "I'm getting it to build my credit score" would rapidly turn into to "I've destroyed my credit score"

Things to remember about credit cards

1. They send you a bill
2. Pay it or at the very least pay the minimum payment
3. Do that straight away, or at the latest by the payment date
4. The minimum payment and the payment date will be clearly stated on the bill
5. Being one day late is as bad as being a month late
6. Paying 1p under the minimum payment is as bad as being £100 under he minimum payment
7. SET UP A DIRECT DEBIT FOR THE MINIMUM PAYMENT
8. Then pay off the full bill when you get it, the minimum payment won't be collected if you do this within a few days of receiving the bill
9. SET UP A DIRECT DEBIT FOR THE MINIMUM PAYMENT
10. They won't send you a reminder/text/phone you/send a red bill if you miss the payment, - just record a missed payment on your credit file, charge you £12.00 and send you a letter - so what you need to do is
11. SET UP A DIRECT DEBIT FOR THE MINIMUM PAYMENT
12. The Payment Date as mentioned in point 2. is the date that the Vanquis has to have RECEIVED the money by, not the date you sent it, very important if you pay bills online in the evening, banks/credit cards companies work to business days, so if your bill was due to be paid on the 12th December and at 6.00pm on the 12th December you paid the bill in full - you're late so
13. SET UP A DIRECT DEBIT FOR THE MINIMUM PAYMENT
14. that way if you have the money in the account, it's the Card company or the bank that is at fault if it's not collected.
15. Although never rely on a direct debit for the FIRST PAYMENT you will make to the card, wait until it says clearly on your bill "Your minimum payment will be collected by direct debit on xxxxxx"