Credit card on Experian

trubster

Bit of a newbie outside the parking boards - A few more posts are to follow , My new years resolution was to sort out my appalling credit file, I got approved for a credit card and I was under the impression that it would look good to run it up (only £500 limit) and clear it in full every month.

I went on Experian (Trial) and it comes up as a negative - pointing out that I am using 97% of available credit.

Is this looked at negatively by lenders? I have had the card 2 months and it shows 2 balances around the limit, but does not reflect that it was paid in full before the due date?

[Deleted User]

Running a card up to the max looks as if you are desperate for credit. However, this is offset by paying in full each month, which is clearly a good thing.

Try to stay well below 50%.

Tixy

There is no definitive answer, but general advice is to keep the balance at less than 50% of your limit.

In reality any other potential lender viewing your credit file will look not only at the utilisation but also the actual amounts involved. But if you are only using for credit history building purposes then I'd just stick £200 or so on a month (and repay in full).

trubster

Thanks for the replies, I will use it to about 30-50%, I was just thinking that running it up and clearing it looks good to the lender and would help with limit increases etc.

I have a lot of mess to clear up after burying my head in the sand for so long. Fortunately a lot of the adverse stuff is due to drop off soon.

Thrugelmir

trubster wrote: »

Is this looked at negatively by lenders? I have had the card 2 months and it shows 2 balances around the limit, but does not reflect that it was paid in full before the due date?

What's the positive? Running up the balance and clearing it every month proves nothing. In terms of you as a potential borrower.

Experian_company_representative

Hi Trubster,

As Tixy and ZX81 have said bring the percentage of available creidt you are using down and your report will look better to lenders.

If lenders see that you are using a lot of the credit available to you, they will think you are in danger of becoming over-committed.

In most cases lenders can see how much you have paid each month, but they will still be concerned that you are having to rely on credit to get by.

I hope you are finding the trial useful!

Kind Regards
Neil