No Debts & No Credit!

aymz1983

Well what a ray of sunshine you are. I'm almost glad that you've ruined your nice shiny new credit history by taking out payday loans - which (as mentioned above) is a huge no-no for many high street lenders, even if you paid them off straight away. Paying them off on time won't be the issue but the fact they were used at all will be.
Some sarcasm in replying (although the information within can still be well regarded) is hardly acting like one is above another. Name calling and wishing ill financial health on someone because some people didn't play nice enough for you is.
There is a wealth of information on these forums from where people have asked the same sort of question as yourself a thousand times over. It doesn't take much to have a look first before asking the same question that has been heard many times before.
If you carry on with the disrespectful tone because you don't get the perfect answer you want right away, you may well find that no-one even bothers to answer your questions at all.

aledmann

Just a quick update on this for anyone else in a similar position. I did some digging around and found this blog post from Martin on MSE (last updated 2013).

PDL's are such a new (and ever popular) source of lending that there are no real hard and fast rules when it comes to how it affects your CR scores yet. I applied for them thinking they would improve my rating (as I couldn't get accepted with anyone else). It would seem in theory this is correct. Here's how Martin puts it:

"Technically getting a payday loan may well help your credit score, which in turn could make it easier and cheaper to get other products such as mortgages. However, I would still caution very strongly against doing it and here’s why...

Payday loans are expensive and risky. The interest rates on these loans are horrendous, and while the actual cost over the short term may not be too bad (say £10-£20 per £100 over a couple of weeks) the longer you delay the costlier it gets (see my Wonga APR would cost more than US debt in 7 years blog for the dangers).

There’s a way to do it better and for free. There are many ways you can pretty up your credit worthiness (see the Credit boosting guide for more) to help (re)build your score."

So aymz1983, robber2, MEM62, forgotmyname and im-lost - maybe you should check the soundness of your advice before spewing false authoritative drivel on here in future.

As for me, I've just closed my PDL and applied for a credit builder card instead to help my rating. Hopefully in 6-12 months from now I can start looking at those sub 5% lenders again.

SeduLOUs

Financial advice, rules and best-buys change all the time, so reading something that may have been valid two years ago might not be relevant anymore.

If you'd read the June 2015 article about Payday loans instead you would have seen:

Apply for any credit, and lenders 'score' you to predict your likely behaviour. They use data from credit reference agencies as part of this (see the Credit Scores guide). But a payday loan on your credit report can have a striking effect. All credit reference agencies differentiate payday loans on your credit report. They’re in a different section, so underwriters (who make lending decisions) can tell how much and how often you've used payday loans.

http://www.moneysavingexpert.com/loans/payday-loans

matttye

aledmann wrote: »

Just a quick update on this for anyone else in a similar position. I did some digging around and found this blog post from Martin on MSE (last updated 2013).

PDL's are such a new (and ever popular) source of lending that there are no real hard and fast rules when it comes to how it affects your CR scores yet. I applied for them thinking they would improve my rating (as I couldn't get accepted with anyone else). It would seem in theory this is correct. Here's how Martin puts it:

"Technically getting a payday loan may well help your credit score, which in turn could make it easier and cheaper to get other products such as mortgages. However, I would still caution very strongly against doing it and here’s why...

Payday loans are expensive and risky. The interest rates on these loans are horrendous, and while the actual cost over the short term may not be too bad (say £10-£20 per £100 over a couple of weeks) the longer you delay the costlier it gets (see my Wonga APR would cost more than US debt in 7 years blog for the dangers).

There’s a way to do it better and for free. There are many ways you can pretty up your credit worthiness (see the Credit boosting guide for more) to help (re)build your score."

So aymz1983, robber2, MEM62, forgotmyname and im-lost - maybe you should check the soundness of your advice before spewing false authoritative drivel on here in future.

As for me, I've just closed my PDL and applied for a credit builder card instead to help my rating. Hopefully in 6-12 months from now I can start looking at those sub 5% lenders again.

'May well help your credit score' does not mean 'WILL help your credit score'.

It's well known that some lenders refuse to lend to those who have taken out payday loans.