Help on improving rating - moving money vs not!

EOX82

Hi can somebody help me with the best thing to do re improving my husband and I credit rating for getting a mortgage?

We both have a good rating with equifax, I have a good rating with experian but my husband only has fair. One of the negative factors for both of us is the utilised credit %. We only have one ccard each and they are nearly at the limit.

Like I say we are wanting to apply for a bigger mortgage next monthish.

Would it be wise or unwise for me (with the good rating apply for a 0% ccard and spread the debt around, maybe clear and close his (as his limit is only £500 and experian say this shows higher risk) and trf what I can off my other. This will make our utilised credit % better will remove the credit account which has the small 'high risk limit' and I'll pay less interest. Of course the downside will be negatively affecting my good rating with a search an a new account.

But will the positive of this plan outweigh the negative?

It's swings and roundabouts we have 15-20% deposit for our new house.

The other option would be to apply for mortgage and if it's rejected to send it to underwriters explaining that when my husband applied for his ccard he had a default on his account which was wrong and we were compensated for it and our credit report put right. This would have affected his ability to get a bigger limit.

I think it's ridiculous that in this day and age that having a ccard with only a small limit and one search and one new account in past 12 months means only a fair score. No missed payments, no defaults everything else all in place. Surely an underwriter will be sensible?

forgotmyname

Spreading the debt arounf still puts you in the position of having x amount of debt with x amount of income.

Pay the debt off and the credit file should improve. Ignore the credit ratings that they give you though. Those numbers mean nothing to the actual loan companies.

You could have a 999 rating and still fail to get credit.

How long at the current address? On the electoral roll?

Wont paying the loans off make more sense than having to spend some of the deposit paying the interest?

Experian_company_representative

The utilisation calculations we help lenders calculate (in the scores we build) generally look at all your revolving accounts (mainly cards and mail order) overall plus the most utilised single account. If you can make sure both are lower than 25% that should help. Having at least one substantial credit card limit can also be advantageous. But closing an account means you gain an additional 'successfully settled account' which can help your credit score as well. The difficulty is that for each person some of these factors will be more important than others because it depends what other information is recorded. While only indicative, the scores you can get from the CRA websites can give you an good idea how your credit history is likely to affect credit scores, based on your whole credit report.

James

James

Thrugelmir

EOX82 wrote: »

It's swings and roundabouts we have 15-20% deposit for our new house.

Use it to clear your debts. Far better from a mortgage lenders perspective.

EOX82

Thanks for replies, I think we will pay down the small credit card as much as we can. Decided not to move stuff around. Might be able to reduce mine down to 70-80% but that's it really.

The deposit is all equity in current house so can't use it to pay off debts. Our total combined debt is £2475 which I don't see as that much in this day and age.

Been on electoral role at current address for 11 years.

Another thing with my husbands fair report from experian is that all his accounts are duplicated because our address was in as a previous address also. This means his debt is showing as twice the amount it actually is. Should be put right but should this improve things?

willLeeds

I noticed a spelling mistake in my name on Experian.

Wiliam rather than William.

When i changed it, it duplicated all my accounts. I sent them a letter asking for written confirmation it had been changed and within a month it was correct.