When to apply?

Captain_Shambolic

Hi there, hoping for some quick advice.

To give a little background, I checked my Experian credit report because I wanted to see what my credit looked like before applying for a second credit card.

Including overdraft I have about £5k worth of debt and to keep on top of things I pay about £250 a month but this is spread over a number of providers and I worked out that getting a credit card of about £1500, will allow me to clear enough debt to save about £150-£180 a month, which makes it an attractive proposition.

I was optimistic after checking the credit report and seeing it come up as average, so better than I expected given that while I've gotten a lot better over the last couple of years, I did have a sketchy history (a hangover from the student days).

The question is around the fact that I'm starting a new job soon, I've heard that lenders like stability which seems obvious and up to Thursday I'll have been in my current job for 16 months. However, my new job comes with a massive pay rise, to the point that it represents an increase of about 40%.

So basically, which is better in the eyes of the lenders? More money, or a longer employment history? It's also worth noting I've taken steps to give myself a better report by adding myself to the electoral roll but I'm not expecting this to show for a couple of weeks.

Thanks in advance for the advice.

The_Boss

What's your current salary? You may be able to successfully apply now, but if not I'd wait until six months after your new job joining date personally.

Captain_Shambolic

Current salary is £16,500, new salary is £23,500.

Nasqueron

Lender will look at credit record (not the made up score)

Do you have any missed payments/defaults etc?

Assuming no bad marks, on a salary of 16.5k and 5k total debt you should get a new card fairly easily.

As an example, I am on 18.5k I lowered credit limit from about 12k to about 5k a couple of months back and (with a clean record) got a 5.5k balance transfer card from Barclays to use as an interest free "loan" to pay off a couple of big purchases I had.

Hope that helps

If you can afford to wait, get the new job, pass any probation period and be settled for 6 months as above and then apply. Barclays only asked my salary not how long I had been in the job

The_Boss

I'd definitely wait to be in your new job for 6 months as almost certainly the electoral roll entry would appear on your credit file by then.

Captain_Shambolic

Hmm thanks for the advice people. I suppose I can wait, as I've not had any problems with debt recently, just would have been nice to clear a chunk of it in one go.

Again, thanks for the advice, any more you could provide would be good, just to help my credit chances.

YorkshireBoy

When do you start your new job?
Is it with the same employer?
Have you recently moved address?

If a new employer and a new address, then with £5K of debt and regular(?) use of your overdraft you may not be in a better position in a few months time anyway.

In your shoes, I'd be monitoring my credit file* and applying as soon as you're showing on the ER and with the current employer. Then again, maybe an application for a credit card from your bank may be an option?...so long as overdraft usage isn't too much of a concern to them.


* At this time of year the annual canvas of electors is taking place, and CRA updates may be put on hold until December.

Captain_Shambolic

YorkshireBoy wrote: »

When do you start your new job?
Is it with the same employer?
Have you recently moved address?

If a new employer and a new address, then with £5K of debt and regular(?) use of your overdraft you may not be in a better position in a few months time anyway.

In your shoes, I'd be monitoring my credit file* and applying as soon as you're showing on the ER and with the current employer. Then again, maybe an application for a credit card from your bank may be an option?...so long as overdraft usage isn't too much of a concern to them.


* At this time of year the annual canvas of electors is taking place, and CRA updates may be put on hold until December.

I start my new job Tuesday and it comes with a 6 month probationary period.

It's not with the same employer, rather I'm moving from an outsourcing company to the main company doing the outsourcing.

I've been at my current address for nearly 2 and a half years now, although my previous address is a funny one, where the council and landlord know it as different names.

I've already got a credit card with my bank (which I got to get an engagement ring and cover a few bills) and I am regularly in my overdraft although am careful to not go over. I have gone into the unauthorised overdraft a couple of times in the last few months although this doesn't show on my credit report? (They've got me as satisfactory on the overdraft)

The main debt I want to clear is a number of Provident loans, as I'm currently paying back £30 a week, which can total £120-£150 a month depending on how many Mondays there are in the month. My thinking was that even at the most restrictive interest rates, it's unlikely I'd be paying half of that a month on a credit card (indeed with me at my current credit card limit I'm paying about £35 a month)

CLAPTON

Captain_Shambolic wrote: »

Including overdraft I have about £5k worth of debt and to keep on top of things I pay about £250 a month but this is spread over a number of providers and I worked out that getting a credit card of about £1500, will allow me to clear enough debt to save about £150-£180 a month, which makes it an attractive proposition.




Thanks in advance for the advice.

rather than think about 'saving' 150-180 per month, maybe think about repaying the debt more quickly


moving debt around to reduce interest/fees is a good thing but don't think of it as clearing debt because you have only moved it.


how much do you owe on each debt
what are the APRs or fees on each debt

with you new improved salary, could you not combine that with a couple of 'no spending' months and clear the most expensive debts once and for all?

Captain_Shambolic

Okay, so by way of update;

I decided to apply for a credit card through Barclaycard, using this site as a reference and I almost fell off my chair when I found out that not only had I been accepted, but given a £3,000 limit! However I have a few questions;

The site states that I have a £3k credit limit but a £900 cash limit, from what I understand the difference is simply what I can withdraw and my overall limit, however I have the following debts (with how much I pay a month in debt management)

Overdraft: £2.5k - £50 p/mth
Provident (doorstep loan company): £1k - £150 p/mth
Credit Card: £1k - £35 p/mth
Argos Card: £300 - £10 p/mth
Very Account: £800 - £25 p/mth

Basically, I'm looking for advice on how and what to clear. Provident is the massive priority, which I can clear with a combination of wages and this new card next month but I need to know what I can clear using the credit limit and what has to wait. I know this card is 0%, but can't seem to find for how long on their website.

Again, any advice is much appreciated.

lynz68

Is your card 0% on balance transfers or purchases. I know mine is balance transfer and was a shorter 0% for purchases.

Why I ask is if it's balance transfer your Very Account would be a purchase and not a balance transfer, not sure about the Argos account but still may be less interest to pay on your card.

Without knowing interest rate of your various debts it's hard to advise. But definitely pay of the Provident Loans as they are more certainly the highest rate of interest you are paying.