Improving credit rating/ bank account application

purplevelvet

Hi

Can anyone advise me as to whether, once things have gone a bit awry, you are forever damned until the six years is up?

Let me explain...

I had a CCJ taken out against me about 3 years ago by a former employer after a wrangle about a funding agreement for some training. Anyway, I settled it in full after paying in installments for a year. It is marked as "satisfied" on my file. I settled it two years ago. I also had a couple of defaults from other things, but have settled them all. I had a huge overdraft
(6.5K) and had a default on that too. I repaid the last of it in January 06. Actually, I've paid just about everything off now.

However...

1 I still have a mail order shopping account. It is not in arrears, has an availalble limit of £1500 above the current balance and I pay it on time every month. I am not using the account to make new purchases, just paying off the balance - I am hoping this is stabilising my credit record, along with the other things below.

2 I have a personal loan that has never been in arrears. The original amount was £6000 outstanding balance now £680. Monthly payments like clockwork

3 I have one "old" loan account running. I had defaulted on it a couple of times, but for the past 18 months I have paid it every month on the dot.

My first question is -Will the regular payments I am making on these accounts be helping to rebuild my credit standing?. I know that regularly paying a credit card would, but I don't have one - nor do I want one (Danger!!!)

I took out a (quite large) mortgage last year with a friend. it was with a "specialist" lender because of the CCJ but the interest rate isn't that bad (they said if the CCJ had been paid for a few months longer it wouldn't have been taken into account at all) It is paid on time every month. We already had a joint mortgage before this.

My friend though, has now applied for a business bank account and I am worried that because we have a joint mortgage, my credit will impact on the application. It's an A&L account that's been applied for. My friend is so careful and good with money it's scary. I would hate to think that my past will impact on her creditworthyness.

So, my second quesation is - will the bank turn her down because of me?

Any advice??

Thanks

mleonard79

Hi Purplevelvet,

I certainly think paying the loans, mortgage and mail order shopping account will be helping to improve your credit rating quite a bit so long as you never miss any payments but the CCJ is bound to still impact upon it as well.

My friend had a flatmate that had an extremely poor credit rating and was my friend was turned down for something due to this initially but she was able to disassociate herself from her flatmate financially so that her financial situation was not taken into account when she applied for anything herself after that. I don't think this would be possible if you are financially linked to the person through a joint mortgage though. I would hope with her own excellent credit rating your friend would get her business account ok but there's no way of knowing for sure until she tries as all banks look upon the information differently. Good luck with it.

Regards

Michelle

purplevelvet

Thanks for that Michelle. The business bank account form said "you will be issued with either a Visa Debit or Electron card". I am hoping this means that they will open the account even if they don't give her a full Visa. I hope they do as she is, as I said, brilliant with money.