Dmp and credit scores.

hel2326

I have been paying a DMP for 2 years all I jow have left is a credit card of £750. If I now came out of this DMP and started making the right repayments and on time(which hasn't happened on my DMP) would my credit score go up and in next 6 mnth enable me to borrow on the equity in my house.

[Deleted User]

It doesn't matter, as your credit score has no meaning.

Clearing your debts will mean lenders will view you more positively.

Westminster

Being on a DMP effectively trashes your credit file.

Depending on the details - I suspect the only secured lending you might be able to get approved for would be at an excessive interest rate.

Why are you so keen to plunge right back into more debt having just about cleared your last batch?

CalumHeath

Credit scores are completely irrelevant.

Lenders do not see your credit score and those that give credit scores (Noddle, Experian, and others) do not make lending decisions.

Lenders do, however, see your credit history which is (should be?) an accurate record of credit accounts and how you managed them, and applications for credit.

Your eligibility for any credit is not solely based on one factor (and certainly not a score or rating); any combination of the following factors might be taken into consideration by a potential lender:

- amount of existing debt
- amount of existing available credit
- history of settled accounts
- history of incurring defaults
- number of recent applications for credit
- age
- whether single, married, widowed, separated or divorced
- whether home-owner, tenant or living with parents
- whether you're on the electoral register
- current employment status
- length of time with current employer
- salary

This is by no means an exhaustive list and how each credit-provider assesses you is different; some companies may not consider many of these factors (Payday lenders), some may consider even more (mainstream lenders, mortgage providers). Certain factors may not carry any weight and some might dictate the decision-making process completely - you'll never know.

Ultimately, it's up to each company whether they want to provide credit facilities and on what terms. They have no obligation to lend to anyone nor explain or justify their lending criteria at any time. It's not based on a score or rating.

Credit scores are completely irrelevant.

Superscrooge

hel2326 wrote: »

I have been paying a DMP for 2 years all I jow have left is a credit card of £750. If I now came out of this DMP and started making the right repayments and on time(which hasn't happened on my DMP) would my credit score go up and in next 6 mnth enable me to borrow on the equity in my house.

Clearing your debt always helps your credit history. But realistically it is going to take several years of gradually building up good credit history before lenders regard you as a good credit risk.

The concern of any lender reading your post, would be that before you have even finished paying off your DMP, you are talking about borrowing even more money. This creates doubt about whether you are in control of your finances.

20aday

I was in a DMP many years ago (13 as of this September) and it had a negative effect on my credit history until two years ago.

Not only that one of the terms of being in such a programme is that you don't obtain credit from elsewhere.