Help! Cancelled credit card before mortgage application - have I made a !!!! up?

Bardo_Pond

In a bit of a panic with this one, hope someone can help! My husband and I are FTB's intending to use the HTB equity loan scheme.

My credit score is excellent and so is my husbands and thinking it was the right thing to do told him to cancel a credit card that he'd never used but had for years.

This morning his Experian report has gone down from 999 to 964 as he has no revolving credit.

Have I made a massive !!!! up and hampered our mortgage chances by getting him to cancel this unused card? He's on the electrol roll, has a mobile phone and 2 bank accounts but apart from that, no credit. Thank you in advance.

MortgageMamma

When are you planning on actually applying for the mortgage as it may be possible to resolve it

Bardo_Pond

Hi, it'll be at the back end of March/early April.

MortgageMamma

Ok, well the thing to remember is 964 is a really good credit score so it may not affect your eligibility for a loan. The lender will look at your credit record over a specified period so if they can see there has been a credit card there in the past but its not been used so you've cancelled it, it will most likely have a neutral effect. You could ask your mortgage broker to put some notes on the application to explain this.

You could of course just get another credit card, spend on it and repay in full monthly but time is short and then your score will reduce again with the search - it will recover and I couldn't say by how much but if you ended up doing multiple searches via a comparison site that could be damaging. I do know when I did some car insurance searches in November my credit score got a bit hammered so be careful there. Somebody else might be able to answer this bit better!

amnblog

This will make zero difference.

Stop worrying.

chanz4

the scores mean zippy

Bardo_Pond

Thanks everyone, it's just unnerving seeing the dip in his 'score'. I was also worried that him having access to NO credit card anymore would also be an issue for a lender - would it be or is it negligible when everything else is fine?

amnblog

Check out Experian's explanation of their 'score'

http://www.experian.co.uk/consumer/experian-credit-score.html

On this page their tell you that even a score in the late 900's does not mean anything.

Their advice on maintaining a good score contains such gems as:

Don't get defaults on your record and make late payments, or max your credit cards.

The one piece of advice that is a practical step that can help is make sure you are on the Electoral Register.

The 'scores' I see tend to be plus 900 (unsurprisingly, from people who pay everything in full and one time), or sub 700 (for those who have missed payments or borrowed what they have not cleared)

Borrowing what you can't pay back or missing payments is what makes the difference. Everything else is piffle.

Righteous

I wanted to know as well...I have just sorted out my credit score after month of battle. I really want to get my 7.5k credit card to a 0% card. Soon as possible.
But i am thinking to get a mortgage this year if I can. Can I go and get a better credit card deal without been penalised for a mortgage later on?

Any advice much appriciated