Improving credit rating

kelp7

Hi,

I'm very new to the forum so apologies if I'm asking something that's already come up. My partner and I want to start looking for a house to buy (we're currently renting) but both of our credit histories are pretty empty. She's never had a loan or credit card or any form of credit (but has a lot of savings, plenty for a house deposit). I had some bad credit in the past but this is now resolved and my own credit history is now at the point where it's a clean slate (much like my partner's, I guess).

What we want to do is build up a good credit history as I don't believe we can get a mortgage when we both have 'empty' credit histories now (is this correct?). I have already taken out a Cashplus Mastercard which I'm going to put their 'Credit Builder' facility onto and pay this off over the next 12 months.

I've also read in many places on the 'net that you can also improve your credit rating by having either a landline or a mobile phone contract. I don't think I can get a mobile phone contract as I only have a Halifax Easycash bank account (not current account) which only provides a Visa Electron debit card and no overdraft. But I *have* read that I could get a mobile contract if I have a Mastercard. The Cashplus card (when I receive it shortly) will be a Mastercard. So really, I have two questions I'd like to ask:

1. Would the Cashplus Mastercard be accepted by a mobile phone company for me to gain a 12 month phone contract? (I would prefer with Orange as that is who I am with currently for my pay-as-you-go mobile)

2. If I go with a 'SIM only' contract rather than going the whole hog and going for a contract that provides a new phone as well, does this still count on your credit record? I'm worried that if I choose a cheaper option (but still a contract), i.e. getting a SIM only that it won't count on my experian / equifax record.

Any expert answers very much appreciated indeed!

Thanks

brenda10

Hello Kelp7,
My daughter and boyfriend are just out of university, both have jobs and I encouraged my daughter to get a tesco credit card, she works abroad so I use her card and then pay it off as soon as money spent, I transfer money in to the tesco credit card again, I leave direct debit payment of 1£ to pay on it at the end of each month. I am hoping to improve her credit rating, along with that they get tesco points which they exchange and get the £25 18-26 yr travelcard with the tokens. I don't know much else about the mobile phone contracts to help but hopefully some other more knowledgeable person will be along to help.
Good Luck.

kelp7

Hi brenda10,

Thanks for your reply. I'm roughly 16 years out of university myself I just need to get myself back on track and my partner has never had any credit in her life so I guess I am asking some very specific questions to our situation which I would love to know the answers to, but thanks again for your advice. All taken on board!

Thanks

sfax

Apply for a sub prime CC like one of the cap one cards here:

http://www.moneysavingexpert.com/credit-cards/bad-credit-credit-cards

For a mortgage, it's not as important to have a strong credit history - as long as they can identify you and there is nothing negative on there like late payments or CCJs.

The most important thing is your LTV and your income to debt multiples. If you take on a mortgage at 75% LTV and you fail to repay it, they can just repossess your house and still turn a profit

kelp7

Thanks. That's good to know about not needing the strong credit history to have a mortgage. I guess the main current issue is that there is no history at all now, on either of our records (well, soon to be none on mine, nothing on hers). So I want to get some monthly zeros onto the Experian report (or other CRA obviously). I did try applying for an aqua card last week but was denied, hence the going for the Cashplus card. (There is still some negative history on my record but it's about to be cleaned off in a couple of months' time once the 6 years have gone by)

kelp7

Essentially my main question is, does having a mobile phone contract contribute some nice 'zeros' onto your credit report each month? And do you have to purchase a full phone plus SIM from the provider or can you just have a SIM only contract and that will still contribute zeros to your record? (as long as you keep up payments obviously).

cats2012

brenda10 wrote: »

Hello Kelp7,
My daughter and boyfriend are just out of university, both have jobs and I encouraged my daughter to get a tesco credit card, she works abroad so I use her card and then pay it off as soon as money spent, I transfer money in to the tesco credit card again, I leave direct debit payment of 1£ to pay on it at the end of each month. I am hoping to improve her credit rating, along with that they get tesco points which they exchange and get the £25 18-26 yr travelcard with the tokens. I don't know much else about the mobile phone contracts to help but hopefully some other more knowledgeable person will be along to help.
Good Luck.

I know it isn't the point...but this is actually fraud...

smillingjimmyc

off topic a bit but i have the c.a.b negotiating on my behalf with 3 credit card providers to pay off balances at an affordable amount,this will mean I have defaulted etc.Would it be wise to apply for an aqua credit card(for emergencies only...honest!!) whilst these negotiations are going on.

kelp7

Sorry to *bump* this back up to the top, but just hoping anyone can just clarify my main original query which was : do sim-only contracts with mobile phone providers count towards your good credit history in the same way that a full mobile phone contract does? I don't fancy spending the money on a new phone as well as SIM card as I already have a phone that I like, but I would really like to take advantage of the fact that having a mobile contract can improve your credit score.