I'm new to credit cards and need help?

rk8479

I'm 18, i needed a loan for a vehicle but as i have had no credit in the past when i went to Barclay they recommend i get a credit card to help build my credit rating. i work full time and get roughly £6000 a year.

the questions i have are:

1. on the paperwork it says i have a minimum credit limit of £250, does this mean i have to spend £250 or more for it to be on credit or is it something else?

2. it said my maximum would be based on my status, what would this be roughly, is it based on income or credit history?

Thanks

[Deleted User]

They will tell you want your limit is. It could be as low as £250. There's no way for us to tell - it's based on income, history, affordability, and a thousand other factors that only they know.

Whatever the limit is, the key thing is to never exceed it and always make payments on time.

rk8479

Deleted_User wrote: »

They will tell you want your limit is. It could be as low as £250. There's no way for us to tell - it's based on income, history, affordability, and a thousand other factors that only they know.

Whatever the limit is, the key thing is to never exceed it and always make payments on time.

Thank you but with the minimum limit is that the minimum i have to spend for it to be on credit or is it something different?

the_insider

The minimum limit is the lowest amount they will offer you. The credit limit is the amount they will let you borrow. So it will be at least £250.00 and probably not much more based on your income and credit history (or lack of). Just make sure you check the paperwork when it comes and if you don't understand anything come on here for some help.

rk8479

the_insider wrote: »

The minimum limit is the lowest amount they will offer you. The credit limit is the amount they will let you borrow. So it will be at least £250.00 and probably not much more based on your income and credit history (or lack of). Just make sure you check the paperwork when it comes and if you don't understand anything come on here for some help.

Thanks for clearing that up for me, you guys are more helpful then the people over at yahoo answers

[Deleted User]

Yahoo answers is great if you want to know when the next Call of Duty is coming out, but that's about it.:)

rk8479

Deleted_User wrote: »

Yahoo answers is great if you want to know when the next Call of Duty is coming out, but that's about it.:)

haha yeah

sweetilemon

So to clarify, you don't have to spend £250, it will just be at least £250 you are allowed to borrow. You can still spend £1 on the card if you so wish. Pay it off in full each month and you won't pay interest.

samsonprince

yes thats right

rk8479

One more question i have...

The guy who dealt with my case at the bank said as long as i buy things on credit and transfer the money from my currant account into the credit account to pay the debt it will clear the debt straight away and improve my credit rating by showing i can manage my money. is this true? and also if i do this and bank wants to increase my limit could they increase it daily or monthly? i asked for them to set it all up on online banking so i could see it all and manage it all online

CKhalvashi

rk8479 wrote: »

One more question i have...

The guy who dealt with my case at the bank said as long as i buy things on credit and transfer the money from my currant account into the credit account to pay the debt it will clear the debt straight away and improve my credit rating by showing i can manage my money. is this true? and also if i do this and bank wants to increase my limit could they increase it daily or monthly? i asked for them to set it all up on online banking so i could see it all and manage it all online

It's done once a month.

I have a card with a £20,000 limit on there, and I spend roughly £4000 on it each month, so 20% of the available credit.

I pay this off in full by Direct Debit from my bank account once a month, which means I'm not paying interest, and I'm effectively keeping £4000 that would disappear throughout the month in my account, earning interest.

In the case of a £250/500 limit, if you spend no more than 30% of the available credit (£75/150 in the example I gave you), then you'll build a credit history and it won't cost you anything.

I hope I've explained this well enough for you.

CK