will car insurance payments help my credit

kelevraz

currently about to get new insurance, the plan was to pay it off all at once, but im thinking that it would help me to pay monthly? as it would show that im paying something ontime every month?

ultimately would there be a difference in the effect on my credit file if i pay month by month vs paying all at once?

Tixy

Sometimes paying in instalments shows as a credit agreement on your credit file, but often it doesn't.
Depends on who you buy the insurance through I guess.

But most charge a high APR and if its just about building credit then there should be cheaper ways to build up a credit profile.

kelevraz

Tixy wrote: »

Sometimes paying in instalments shows as a credit agreement on your credit file, but often it doesn't.
Depends on who you buy the insurance through I guess.

But most charge a high APR and if its just about building credit then there should be cheaper ways to build up a credit profile.

actually, the difference in price of who im looking at - morethan

with installments, total payments will only be £30 more than if i pay off at once, im just trying to open as many agreements as possible

Tixy

"As many agreements as possible" isn't necessarily the best way to build up a credit history.

A couple of credit accounts that are well run should be sufficient to demonstrate responsible behaviour with credit and build up a positive credit history.

Lots of credit opened close together is in actual fact likely to make other potential lenders more wary in the shorter term.

YorkshireBoy

It's not necessary to 'buy' a credit rating (in the form of a £30 premium on your insurance...which may or may not be reported!).

Assuming you're working and have a good relationship with your bank, ask them for an overdraft facility (but don't use it) and a credit card. Use the credit card each month for essentials (groceries, fuel, etc) and settle in full each month.

If your bank won't oblige, then go for a credit builder credit card such as Vanquis, Aqua, Barclaycard Initial, etc.

izools

kelevraz wrote: »

im just trying to open as many agreements as possible

This will do more harm than good.

The best way to build a good credit rating is by building a picture of stability - an ability to maintain the status quo - to make careful decisions about what accounts you need - and to stick by those decisions.

A small number of impeccably maintained accounts kept open for years will build a much better credit file than a litany of accounts opened and closed in a comparatively hapdash manner.

One bank account
One mobile phone contract
One credit card, paid off in full each month by Direct Debit

Leave it at that and once the accounts have been open 18+ months - assuming you have no prior bad credit - you shouldn't have any difficulty obtaining any further credit you might need at a later date like a car loan or mortgage.

Good luck! :beer: