Quickie....

thesmallprint79

Hello, new to this forum but have a question....

My partner and I have to get a mortgage in roughly 10 months (May/June). Its not that we want to, we have to because we bought our house through a facility on my parents bank accounts through which they kindly invested in buying us a house. In order to pay that back, we must get ourselves a mortgage.

Looking at our credit ratings, we're both 'Fair' my partners being 6 points from Good and me being closer to 'Poor'.

Quick background: we're self employed, have joint bank accounts.

My score has recently gone down because i moved both elec and gas in my name to British Gas so is showing as 2 new credit accounts within 6 months (now 4 months old).

So my question is:
Do new credit accounts only have an effect on score if there is more than 1 within 6 months? Or can opening 1 in 6 months have a bad effect? Because looking ahead my phone contract will be finishing in January, we'd both like to join the Gym (does this effect at all?) plus house insurance renewal will be coming up. Do i need to space them apart by 6 months or how does it work?

Also, i have no idea why my score is so low. I have never defaulted, i'm on the elec roll, lived at house 3.5 years, no CCJs, got a credit card simply to help my score and pay off with DD more than minimum a month. Credit score says 5 positive factors and only 1 negative (these new utility accounts). So why has opening 2 new accs in 6months given me SUCH a poor rating when everything else is good?

Really confusing! Any help appreciated!

[Deleted User]

thesmallprint79 wrote: »

Also, i have no idea why my score is so low.

Neither does the CRA which gave you the score. Fortunately, it doesn't matter and no one sees it apart from you.

It doesn't sound as if there is anything in your credit history which would give a lender cause for concern.

Candyapple

Have you obtained copies of all 3 of your credit files to check the information showing on all of them is correct?

Do you have a bank account? Is this showing on your files?

Do you have any joint accounts with your partner? Does he have any bad debts?

Do you have any settled accounts showing on your files? Lenders like to see a long history of how you have run your accounts in the past.

Do you only have 1 credit card? Again, if you only have 1, I’m assuming you have a low limit? Lenders ideally like to see a few accounts with high limits which shows that you can use credit responsibly.

Is your phone contract showing?

Any late payments?

The Gym won’t credit check you so you are ok on that front. Insurance will just be a ‘soft’ search / enquiry and won’t be seen by lenders so again nothing to worry about.

A few searches in a short space of time doesn’t really have much effect on your credit files. It is all the other information that lenders will take on board, especially if you are going for a mortgage. As long as you have saved a decent deposit and have records of your self-employment etc. just make sure your credit files are all in sync and ignore the ‘scores’ they give as they are meaningless.