Credit scoring, 0% cards

grandplonker

Suppose I have a 0% purchase credit card, the period lasts 18 months. The credit limit is £2,000. I buy something at £1,000 and then pay it off in one go at the 12th month.

Respecting that universal credit scores don't exist, will future lenders see this as worse than paying off a card in full each month?

Tixy

Obviously you'd be paying the minimum payment each month up to the point where you pay off the remainer in full.

After its all paid off then I don't think that many potential future lenders will see that as any worse than having had a card and paying in full each month for a year.

During the 12 month period then its possible it would be viewed as slightly more negatively than paying in full each month.

If you do this then some people recommend you pay just a couple of pounds over the minimum payment for the 11months. This prevents the minimum payment marker being added to your credit file (for lenders that report detailed information).

Cycrow

Some lenders will mark your file with a special rate flag, so they will be able to see this.

i have an argos card with Buy now pay later, each month the special rate appears on my file, but not the minimum payment marker.

don't really know how this effects the lenders decision, but it'll make sense for it to be different to a minimum payment

Thrugelmir

grandplonker wrote: »

Respecting that universal credit scores don't exist, will future lenders see this as worse than paying off a card in full each month?

They will see an unsettled debt. Which will be factored in if you are seeking additional lines of credit.