Phone loan

warpedpolecat

Hey all

Never posted before but was after some advice - I've recently settled a substantial amount of credit as I'm looking to apply for a mortgage in the next year or so - The only credit outstanding at the moment is about £500 on a Credit card and a "phone loan" which is at £630.00 which will be paid off over a few years with 02 for want of a better phrase - Basically, o2 offer their refresh service to pay off this amount - (I wouldn't take a new one for a new phone) - But the only way I could do this would be by using my Credit card - Would this have any positive effect on my credit rating as the credit would be one place or is a completely pointless thing to do?

I'm sorry if this is a stupid question in advance!

Thanks for reading!

m4rc

I'm not sure I understand, maybe it's just me or maybe it's the lack of full stops or commas! You have a £500 debt on a credit card, and a £630 debt on a phone contract through O2, correct?

You are considering taking out a new 'refresh' contract with O2, that's where it goes blurry. I would think they would close the old contract, start a new one and you would now owe he £630 on the new contract. Then you say something about using your credit card!

Or are you saying you have an O2 refresh contract and could pay it off via your credit card?

If so that's a bad idea in my opinion unless you will be settling it quickly, as on the card you will pay interest (unless you have a 0% deal) whereas with O2 refresh it's interest free.

I've just paid off and closed two O2 refresh contracts this week, as I moved to an area where O2 doesn't work, not their fault and nothing I could do, so I paid off the device parts and then they close the contract part for the phone, all nice and simple, I keep the devices and have siimple sim only contracts costing a tenner a month. Not sure this is what you are asking though!

warpedpolecat

Hi m4rc,

I've just re-read that post, it was a complete shambles. Was a wee occupied when I wrote it so apologies for that!

The long and short of it is, I'm not wanting to get a new phone - I'm merely wanting to improve my credit score and was basically enquiring into whether it would be more beneficial to have the same amount of credit owed, in one place i.e. my credit card. Rather than having the two lenders (credit card & O2). The interest and payment amounts aren't an issue in this instance fortunately!

I don't know if this will make a difference in the slightest or if I'm best leaving it!

I hope this makes sense this time lol.

Candyapple

No such thing as a credit score. Only your credit history matters.

In your case, two accounts open and reporting back to the CRAs are better than one. So if as you say interest and payment amounts don't matter in this instance, stick with both accounts open.

warpedpolecat

Thanks! Appreciate your response. Have a good day