credit card application

whistle_pop

Hi all. Just wondered if anybody could help out on this one. I recently arranged to have my electric meter taken out in place of going on to quarterly bills. Before they did this they had to do a credit check to see whether or not I could afford to pay the bill, and if the money could be recovered if I couldn't pay the bill. I was told this was a credit check. Well, they ran the check and said that everything was fine and we could go ahead and remove the meter. Which is great, no more weekly charges for the meter :-)


My question is basically if the energy company are satisfied with my credit for them to take out the meter and put me on quarterly bills (which is a kind of loan in a way?), what would be the chances of a credit card company viewing me in the same way in order to obtain a credit card?

Thanks.

thebritishbloke

This is probably the same sort of check that TalkTalk does when you take out broadband. It's just to check who you are, and that you haven't had any serious financial problems.

What's your financial history like? Any overdrafts? Loans? Mortgage? Etc etc etc.

whistle_pop

No mortgage. Paying off two debts. Both reduced payments, one directly to the creditor, the other to a debt collection agency. Total amount about 1,500. Not applied for anything for a long time though, well over 5 years. No overdraft.

PeacefulWaters

Why are you moving to a more expensive way of paying for electricity?

SnowTiger

whistle_pop wrote: »

No mortgage. Paying off two debts. Both reduced payments, one directly to the creditor, the other to a debt collection agency. Total amount about 1,500. Not applied for anything for a long time though, well over 5 years. No overdraft.

So, the only two accounts listed on your credit report are likely to be marked AP (Arrangement to Pay)?

If that's the case, it's unlikely you'll be able to obtain credit elsewhere.

Maybe the electric company has a low criteria for acceptance or only performed an Identity Check.

Fruit_and_Nut_Case

PeacefulWaters wrote: »

Why are you moving to a more expensive way of paying for electricity?

What makes you think that? I assumed that it was a pre-payment meter being removed to make way for a credit meter, resulting almost certainly in lower costs.

Anthorn

If you went quarterly with the same energy company as provided the PAYG meter and that was the same company who previously provided a quarterly meter and your reason for changing to PAYG was a default then those defaults could show on the history of the account.

Personally I defaulted on both my gas and electricity 5 years ago and went PAYG and both accounts disappeared from my credit file at all three CRAs. So in my experience energy companies don't report to the CRAs accounts which have a PAYG meter. In the unlikely event that I went quarterly I would move to a different energy company and a new account for the reason stated above.

Our traditional view of a lender doing a credit search is that they go through anything and everything as deep as they can go. But in practice they probably just automatically apply points for the info on the application and points for basic information at the CRA, as thebritishbloke says above.