Closing credit cards and settling interest free loan hurt credit score!?

johnnyy

Hi guys, hope someone could help me out here as I am very worried about my credit score and its effect on my mortgage application.

I have never missed a single payment, be it credit account or personal loan.

My credit score on Experian has been good (950+, reached 999 last month until recently fell to around 950) but my noddle score has not been great for some unknown reason. (around 600) and it has declined to sub 600 (596) this week.

The reason for the decline on both credit check provider seems to be because I have been paying off my loan fully and closing my credit cards. Below are my accounts and when I closed them.

1. HSBC credit card which I had for 5 years - Closed this month as have not been using it for awhile.
2. Amex Gold Plus charge card which I had for 10 months - Closed to avoid the annual charge.
3. Interest free personal loan which I took out December 2014. Original schedule for final payment was December 2015 however I fully settled this month as I want to reduce debt balance as I am applying for a mortgage.

The result of the above is that my rating with Noddle has gone to sub 600, and from 4/5 to 3/5.

I have also opened a new credit card this month with Lloyds. This card is not showing on my credit report yet. (Which I think is likely to lower my score further when it is reflected)

I am a bit worried now as I thought paying off loan in full and closing unused credit cards would improve my credit rating but it obviously hadn't...

Would you guys know whether lender would look beyond my falling credit score and consider the "good behavior" of always paying on time, and the fact that I don't have any debt now and that I have only got 1 credit card? Shouldn't this be favorable as it shows that my debt to income ratio is lower?

Thanks so much guys,
John

DCFC79

johnnyy wrote: »

Hi guys, hope someone could help me out here as I am very worried about my credit score and its effect on my mortgage application.

I have never missed a single payment, be it credit account or personal loan.

My credit score on Experian has been good (950+, reached 999 last month until recently fell to around 950) but my noddle score has not been great for some unknown reason. (around 600) and it has declined to sub 600 (596) this week.

The reason for the decline on both credit check provider seems to be because I have been paying off my loan fully and closing my credit cards. Below are my accounts and when I closed them.

1. HSBC credit card which I had for 5 years - Closed this month as have not been using it for awhile.
2. Amex Gold Plus charge card which I had for 10 months - Closed to avoid the annual charge.
3. Interest free personal loan which I took out December 2014. Original schedule for final payment was December 2015 however I fully settled this month as I want to reduce debt balance as I am applying for a mortgage.

The result of the above is that my rating with Noddle has gone to sub 600, and from 4/5 to 3/5.

I have also opened a new credit card this month with Lloyds. This card is not showing on my credit report yet. (Which I think is likely to lower my score further when it is reflected)

I am a bit worried now as I thought paying off loan in full and closing unused credit cards would improve my credit rating but it obviously hadn't...

Would you guys know whether lender would look beyond my falling credit score and consider the "good behavior" of always paying on time, and the fact that I don't have any debt now and that I have only got 1 credit card? Shouldn't this be favorable as it shows that my debt to income ratio is lower?

Thanks so much guys,
John

For the love of god dont focus on your score, lenders don't see it so it doesn't get you finance, what matters is your credit history.

Your score could be 999 but it still wont mean anything.Lenders score you on an in house system based on many factors.

phona

DCFC79 wrote: »

Your score could be 999 but it still wont mean anything.Lenders score you on an in house system based on many factors.

Or put another way: they 'consider the "good behavior" of always paying on time'. Imagine that

I completely agree with DCFC's post above. You're doing fine, stop worrying about these silly numbers.

johnnyy

Thanks a lot guys. Finger crossed things will turn out fine and maybe i should stop paying 15 pounds a month for these stupid scores lol