Experian statutory credit report

Anafrac

Afternoon,

Im after a little clarification regarding my Experian statutory credit report. Im looking to buy a house next year and am looking at things like credit history etc now rather than later. One thing im trying to do is build up my credit history, so I thought I would check through Experian to see if there were any mistakes etc.

The one thing I was banking on seeing was my mobile phone contracts for previous years, But both contrats (O2 & Vodafone) show as balances being £0 with my "Account status code" as being paid and up-to-date. Is this correct ? should my balance be £0, I was expecting to see my bill for the month on this. Or does the £0 reflect, that the bill has been paid and nothing is owed ?

Thanks for the help.

P.S - how much do mobile phone contracts "help", in being considered good to lend to ? I will be getting a credit card as well soon to booster this.

Gordon_Hose

That's what my Vodafone bill always shows. As long as it says "up to date" and has green markers, then don't worry.

ValHaller

Anafrac wrote: »

.... . Im looking to buy a house next year and am looking at things like credit history etc now rather than later. One thing im trying to do is build up my credit history, so I thought I would check through Experian to see if there were any mistakes etc.
P.S - how much do mobile phone contracts "help", in being considered good to lend to ? I will be getting a credit card as well soon to booster this.

For sofa credit, a mobile contract probably helps. For a mortgage, I wouldn't bother, the indicators of whether you are good for a mortgage are things like on the electoral role, out of your overdraft, no pay day loans, no CCJs DMPs or arrangements with creditors and above all healthy savings giving a LTV of 90% or less. And no financial links (joint accounts?) with anyone with credit issues.

StuC75

Also companies register what the balance is at the time of the update - so if the balance has been paid at that time, then £0 will show.

Anafrac

That makes sense, I don't have any bad credit history.... I just don't have much of one. Next step is a credit card I think...

izools

I was about to say, what a mortgage underwriter will want to see is exactly as ValHaller says and as you say, also experience managing credit.

Mobile phones aren't credit, they're 30 day accounts, and they aren't regulated by the consumer credit act, so don't count greatly towards creditworthiness elsewhere.

Taking out one or two basic credit cards - perhaps a Capital One Progress and a Barclaycard Initial would be a good bet if you've not had one before - and paying them in full each month will help greatly.

I'd imagine a mortgage underwriter will want to see a bare minimum of 12 months experience with the credit cards.

ValHaller

izools wrote: »

I was about to say, what a mortgage underwriter will want to see is exactly as ValHaller says and as you say, also experience managing credit.

Mobile phones aren't credit, they're 30 day accounts, and they aren't regulated by the consumer credit act, so don't count greatly towards creditworthiness elsewhere.

Taking out one or two basic credit cards - perhaps a Capital One Progress and a Barclaycard Initial would be a good bet if you've not had one before - and paying them in full each month will help greatly.

I'd imagine a mortgage underwriter will want to see a bare minimum of 12 months experience with the credit cards.

Personally, I would not suggest taking out credit cards purely for the purpose of improving chances with a mortgage. It is a sign of financial stability that you can run your life without one and without loans.

If you do take one out, I would agree that you would need a years history - so perhaps a rod for your own back if you do take one out. And I suggest only take out 1 card - and pay it off in full each month.

Anafrac

ValHaller wrote: »

Personally, I would not suggest taking out credit cards purely for the purpose of improving chances with a mortgage. It is a sign of financial stability that you can run your life without one and without loans.

If you do take one out, I would agree that you would need a years history - so perhaps a rod for your own back if you do take one out. And I suggest only take out 1 card - and pay it off in full each month.

I really don't have any need for a CC. I get by with just a debit card just fine. For my mortgage im currently at £36k and im planning to have my target of 50k come next year. For a house around the value of 240/250. So im around the 80% LTV. From what I have read, I always thought having a CC to build up some history, paying it off each month etc, was good ?

izools

It is, so long as you pay it in full.

Whilst it is not essential to have a credit card when applying for a mortgage, having held one that you've consistently and unwaveringly paid off in full each month will help your application, and increase the range of lenders who are willing to lend to you what you ask for at the rate you want.

It will also help you to get a loan at a sensible rate in future if for example you wanted to buy a car but get an unsecured personal loan from the bank for it instead of having a silly HP type loan from the dealer.

Good luck!

ValHaller

izools wrote: »

It will also help you to get a loan at a sensible rate in future if for example you wanted to buy a car but get an unsecured personal loan from the bank for it instead of having a silly HP type loan from the dealer.

Your own bank wiil normally give an unsecured personal loan if you have been with them a good while and your finances are clean,

izools wrote: »

Whilst it is not essential to have a credit card when applying for a mortgage, having held one that you've consistently and unwaveringly paid off in full each month will help your application, and increase the range of lenders who are willing to lend to you what you ask for at the rate you want.

It won't hurt, but at 80% LTV, but it won't make a difference either.

izools

ValHaller wrote: »

It won't hurt, but at 80% LTV, but it won't make a difference either.

You can't possibly make a sweeping statement like that.

All lenders have different credit scoring models, some will look at someone who has no history with actual credit accounts and laugh in their face, others won't bat an eyelid.

What running a credit card and paying it off in full for 12 months accomplishes, is increasing the range of lenders that OP will pass credit scoring with.