Improving credit with credit card.

concrete_kid

I've taken advice from MSE and have been spending about £100 per month on a credit card each month then paying it off in full.

Would It be as benificial to pay one bill (was thinking TV licence) by direct debit on my credit card and pay that off in full. This way I could cut up the card and not have to worry about it, or be tempted to spend too much on it?

[Deleted User]

You can't set up a DD from a card. You could do a CPA for something, but that runs the risk of your forgetting when you eventually cancel your card and being hit with all sorts of late payment fees.

Just put a tank of petrol on it a month and pay in full.

concrete_kid

I didn't realise you couldn't set up a direct debit on a credit card so thanks for that. That's obviously why you don't see it reccomended!

The_Boss

You can set up a direct debit to pay the full amount on your credit card each time if that's any use. Means you don't have to remember about paying.

Also you don't need to spend up to £100 if you don't want to. A couple of quid would have the same effect! Suggest you apply for another card and do the same on that though so your report is gathering data for two credit card accounts and therefore increases the (hopefully positive) data that is reported for you.

ClimbingOutOfDebt

Is this worth doing? As in, does it "build" credit? I've seen conflicting opinions on the forum in the last few days (have been doing lots of research) and I'm not sure whether to risk it and apply.
I tried the mse eligibility checker which puts me at a 90% chance of getting a card. However I've also read that the checker isn't all that accurate.

I appreciate that the only way to know for sure is to apply, but I don't want to do more harm to the CF when my intention is to improve it!
Has anyone found this approach to credit building beneficial?

[Deleted User]

ClimbingOutOfDebt wrote: »

Is this worth doing? As in, does it "build" credit?

It demonstrate you can borrow money and pay it back ,which is exactly what lenders want to see.

ClimbingOutOfDebt

Deleted_User wrote: »

It demonstrate you can borrow money and pay it back ,which is exactly what lenders want to see.

Seems odd that people would be negative about this

I'm just a bit chicken since I'm all to familiar with credit rejection and I don't want another one going against me.

rajadazz

Every time you apply for credit it registers a footprint on your credit file. That said, the lenders do not get to see the decision. E.g. if lenders A,B and C have all accepted your application, the credit file will return 3 searches for credit and would be the same if A, B and C declined the applications. Generally any more than 2-3 searches in the previous 12 months is fine and not deemed as risky behaviour but any more might make the lenders worried. So if you have been looking for credit cards recently be careful that you dont apply in too many places.