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Credit history
Mine is terrible.
Long story short: took out a loan many years ago, £5k I think, got WELL behind with it all, defaulted, but a few years later I sorted it all out and got rid.
Fast forward a couple of years I defaulted on £1k overdraft with Halifax, pretty sure that's still out there. I'd guess at about 3-4 years since I defaulted on it.
Messed up a credit card but slowly paid that back and that's now clear as of late last year, I still have the account but I don't use it (destroyed the card long ago).
Got made redundant a few years ago and ended up starting a very low-paid apprenticeship, a necessary career move for the bigger picture though. But on the back of this I used 2 pay day loan companies to get me through, Wonga initially and fell into the usual borrow more to pay off more trap and defaulted on about £900 after 18 months or so of borrowing with them. Got a QuickQuid one for ~£600 and defaulted on that almost immediately. Both I defaulted on about 12 months ago.
I've bounced a few payments on gym memberships, mobile phone, etc here and there over the past couple of years, always caught up but I get paid 4-weekly and bills are monthly so it's been all over the place.
I pretty much didn't care and I intentionally defaulted on the pay day loan companies. I thought that it would be years before I needed a mortgage, etc, so defaulting in a way would stop me getting any more credit anyway and allow me to understand the value of money and learn to save.
The problem is now I wouldn't mind some legitimate credit and for the first time in my life I can afford it, but obviously nobody will touch me with a barge pole.
As I've written this out it's dawned on me I've absolutely no chance of getting credit any time soon and if I want a new car, etc, I'm going to have to save hard for a year and get it that way.
How do I go about clearing it up and making sure that in the future I will be able to get credit? I would really rather not pay back extortionate amounts of fees to pay day loan companies in all honesty, but I doubt there's a way around that.
I appreciate what a clown I am, but I was young, poor, reckless, didn't care and did what I did. I understand the mistakes now and I want to sort it out!
Long story short: took out a loan many years ago, £5k I think, got WELL behind with it all, defaulted, but a few years later I sorted it all out and got rid.
Fast forward a couple of years I defaulted on £1k overdraft with Halifax, pretty sure that's still out there. I'd guess at about 3-4 years since I defaulted on it.
Messed up a credit card but slowly paid that back and that's now clear as of late last year, I still have the account but I don't use it (destroyed the card long ago).
Got made redundant a few years ago and ended up starting a very low-paid apprenticeship, a necessary career move for the bigger picture though. But on the back of this I used 2 pay day loan companies to get me through, Wonga initially and fell into the usual borrow more to pay off more trap and defaulted on about £900 after 18 months or so of borrowing with them. Got a QuickQuid one for ~£600 and defaulted on that almost immediately. Both I defaulted on about 12 months ago.
I've bounced a few payments on gym memberships, mobile phone, etc here and there over the past couple of years, always caught up but I get paid 4-weekly and bills are monthly so it's been all over the place.
I pretty much didn't care and I intentionally defaulted on the pay day loan companies. I thought that it would be years before I needed a mortgage, etc, so defaulting in a way would stop me getting any more credit anyway and allow me to understand the value of money and learn to save.
The problem is now I wouldn't mind some legitimate credit and for the first time in my life I can afford it, but obviously nobody will touch me with a barge pole.
As I've written this out it's dawned on me I've absolutely no chance of getting credit any time soon and if I want a new car, etc, I'm going to have to save hard for a year and get it that way.
How do I go about clearing it up and making sure that in the future I will be able to get credit? I would really rather not pay back extortionate amounts of fees to pay day loan companies in all honesty, but I doubt there's a way around that.
I appreciate what a clown I am, but I was young, poor, reckless, didn't care and did what I did. I understand the mistakes now and I want to sort it out!
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Comments
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Settle all your outstanding debts, get a sub prime credit card (if they'll accept you), use it properly and move forward from there.0
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Save with a credit union as you won't be touched with a barge pole like you said."All truths are easy to understand once they are discovered, the point is to discover them."
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More questions:
-When using a credit card to build up a good history, say spend ~£50 a month and then pay it back, is there a timeframe to paying it back to get the positive mark and avoid interest? What I mean is, if I pay it back too quickly will I not get the benefit of a positive credit mark?
-Am I better off paying off a creditor in a oner, one month at a time, or arranging a repayment plan with them all at once? In terms of which is quickest to clear my name and cheapest for me? I'm happy to use the vast majority of spare income a month to get rid of it in a oner, but obviously I can only do this one month at a time.
-How long after paying back owed money will I be a welcome prospect for a bank loan?
Ok here is my immediate plan:
-live like a pauper for a few months, absolute minimum outgoings, leaving plenty of cash spare to pay off debt
-use my existing credit card to begin building a good history
-contact my creditors to arrange payments as per my question above
Aim: 100% debt free by September, with 3 months+ of good credit card history established.0 -
A credit union is not a bank, its run by its members who live and work in the local area, it offers much lower interest rates for members who save regularly on loans and doesn't have the criteria for loans that most banks do ho use computers, its members make decisions on whether you should be able to pay a certain amount of a loan back.
For example my local CU if you borrow £1000 over 12 months you pay back £1091, that's a very low amount of interest and there are no penalties for paying back early and the interest is calculated daily not for the life of the loan like banks do."All truths are easy to understand once they are discovered, the point is to discover them."
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A credit union is not a bank, its run by its members who live and work in the local area, it offers much lower interest rates for members who save regularly on loans and doesn't have the criteria for loans that most banks do ho use computers, its members make decisions on whether you should be able to pay a certain amount of a loan back.
For example my local CU if you borrow £1000 over 12 months you pay back £1091, that's a very low amount of interest and there are no penalties for paying back early and the interest is calculated daily not for the life of the loan like banks do.
Cheers. I've contacted a relevant CU about membership, I'll look into that and get everything clear as above post. Much better way to do it than to try and cheat the system.0 -
I think most of them have a certain time frame you have to have saved I think its 12-13 weeks so you just can't go in and get a loan out."All truths are easy to understand once they are discovered, the point is to discover them."
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My hubby banks with Halifax and has done for many years...has excellent credit rating etc....I on the other hand ashamedly am the complete opposite....adverse credit rating. We do not have anything in joint name....no utility bills...mortgage....credit cards or bank accounts....apart from my own bank account everything is under his name. If he applies for a personal loan (in his name only) will my credit history be looked at?0
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Mine is terrible.
As I've written this out it's dawned on me I've absolutely no chance of getting credit any time soon and if I want a new car, etc, I'm going to have to save hard for a year and get it that way.
That would be the best way to buy a car even if you had a good credit record. No interest and the car belongs to you (not the bank) from day one.0 -
My hubby banks with Halifax and has done for many years...has excellent credit rating etc....I on the other hand ashamedly am the complete opposite....adverse credit rating. We do not have anything in joint name....no utility bills...mortgage....credit cards or bank accounts....apart from my own bank account everything is under his name. If he applies for a personal loan (in his name only) will my credit history be looked at?
Not if you're not financially associated.0
This discussion has been closed.
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