How Fast Can I Improve Credit Score

CLAPTON

clear the debts avoiding interest
save for a deposit


some of the lenders have a calculators on their sites that ask your income, debts etc
try them out and see the effect of the debts on what they will lend.

frankly no responsible lenders should offer a mortgage to some-one with living in an OD

Thrugelmir

8184mand wrote: »

Do they really need to all be cleared though - I'm sure people must have credit already and successfully get mortgages?

It's not just a question of owing money. Lenders obtain an array of data relating to the previous 72 months from the credit agencies. One thing to have a car loan, as that's a specific purpose. Another to still be repaying debt on a credit card from years ago when you've simply spent beyond your means.

forgotmyname

8184mand wrote: »

Have been gifted some money from a family member and also have a significant disposable income once all min payments are made which I was hoping to save to add to the money already have.

Why are you making minimum payments if your saying you have plenty of income spare to pay the debts off?

Those debts and minimum payments wont be helping you get a mortgage.

8184mand

Thanks for the advice and feedback much appreciated. I could probably clear all the credit cards off by the middle of next year and reduce the overdraft by a bit more each month than I am doing at the moment so seems like that would be the best plan of action. The reason I was hoping to do this more quickly was to buy under a government shared equity scheme which expires end of March 16 - don't think I could clear all the debt and save the deposit in that timescale - maybe that's a challenge to set!

8184mand

forgotmyname wrote: »

Why are you making minimum payments if your saying you have plenty of income spare to pay the debts off?

Those debts and minimum payments wont be helping you get a mortgage.

As I mentioned before I am just back off maternity leave so that's why I wasn't able to make greater than minimum payments as I didn't have the same disposable income which I have now.

Edited to add: and I was hoping to save the extra income for a deposit but sounds like best to clear off the debt first. Thanks

8184mand

With regards to the overdraft frankly this has just been laziness to be honest it's been on my account for years! Started to pay it off a wee bit but could so better

Thrugelmir

8184mand wrote: »

With regards to the overdraft frankly this has just been laziness to be honest it's been on my account for years! Started to pay it off a wee bit but could so better

If buying a house is your objective. Then there's something to focus on. Start with a spring clean of your finances.

8184mand

I was just looking at my credit file and the overdraft is only showing I'm using £800ish a month must be the time when they report it? So that's good right? I will pay it off but would I be right to think credit cards first? Also should I close my credit card accounts once I pay them off?

forgotmyname

The fact you use your overdraft every month whether its £1 or £1000 is not good at all.

I dont think they see the actual figures when they check your file? Someone will correct me on that....
You want some credit accounts open and you want to use them BUT pay them off in full every month.

8184mand

Ah I didn't realise the my don't see the amount, so even if ou go into your overdraft be £1 a month that's still a black mark? Are credit card balances better or worse than overdraft? Just trying to understand what to tackle first