Credit Score Not Increasing

hln123

I am currently saving up for a deposit to buy my first home. On preparing for applying for mortgages I checked my credit score to see that it was in the 'poor' section on Experian. The report explained that this was due to my credit card balance being too close to its limit. As a result I decided to do a balance transfer. Unfortunately I was declined for one but then accepted for a Barclay's 3 year 0% interest credit card with a much higher limit to what my balance is. The declined application only decreased my score by a tiny bit. After a couple of months I have checked my credit score again and it has not budged and is still telling me this is due to the same reason - my available credit being too low.

Can anyone advise why this isn't increasing after the balance transfer? I am doing everything else right, never in my life have I missed a payment etc.

[Deleted User]

The score doesn't mean anything, so can be safely ignored.

hln123

How can it not mean anything? I've been told by mortgage adviser with Halifax that I would not be accepted for a mortgage with this type of score?

[Deleted User]

Then the mortgage advisor is an idiot.

A lender will look at the data on your credit file and make decisions based on that. Not a magical number that has no meaning. They cannot see the number and have no need to.

hln123

Ok that's good news. He told me he wouldn't run a joint check on me and my partner as my score would bring down my partners so best to get it sorted first. Would it be worth my while sending my report to a financial adviser before applying for a mortgage?

[Deleted User]

If you have a patchy or limited credit history, then a good broker is the way to go as he can place your application with the right lender.

hln123

Great, thanks for your help

Candyapple

If you are saving up for a mortgage deposit, rather than using balance transfers to extend the life of your debts you would be wise to use up all/some of your savings to clear your debts first.

I have read on here over on the mortgage board and also having spoken to a broker recently (looking to apply for one myself!) they said that any debts you have, some lenders have been known to multiply them by 5 and deduct that amount from your mortgage offer.

Shubsmega

I do not think that the credit score is something that can be just ignored, however it is different for all the rating agencies.

My very recent experiences make me feel that these agencies are near useless for the consumer.

Signing up with Experian, you would at least expect an indication as to how the credit score is produced. This would at least give you an idea as to why things are in a particular situation and action needed for change. Instead of giving you detail information that may help your specific circumstances, they repeatedly offer up a generic script which although applicable to all, has no bearing to that one specific consumer.

I have maintained a good credit file for the past 7 years, with no defaults, ccjs, missed payments, a good amount of savings, no overdraft, and an almost paid of credit balance. Their records show me as having "3 positive features" and "No negative features" and only a "fair" credit score (869).

My problem came when I tried to get to the mechanics of how this judgment is arrived at. I was simply informed that it is unknown as these values are computer generated!! (Which I am fine with). However surely paying for this service would mean that someone would be able to understand some of the subtle complexities enough to explain them to a customer. Is that not the entire point but of signing up to paid services such as Experian? How else would you find out exactly where you are going right or wrong?

Instead they serve, not the consumer, but the companies offering up products that could act as possible solutions to non-specific credit file issues (even though a credit file is a very specific thing). The only offer up blanketing solutions for very broad groupings of consumer types.

While these agencies continue to take this broad brush stroke approach, I feel that the majority of consumers will never truly know why their credit score is or isn't changing. Perhaps as a free service this approach is fine, but I would expect far more depth from a paid service.

[Deleted User]

Shubsmega wrote: »

Is that not the entire point but of signing up to paid services such as Experian? How else would you find out exactly where you are going right or wrong?

No. The point is to be able to see what is on your file.

You then need to use common sense as to how it would be viewed by a lender.

Nebulous2

Shubsmega wrote: »

Is that not the entire point but of signing up to paid services such as Experian? How else would you find out exactly where you are going right or wrong?

The whole point of signing up to Experian is to provide an income stream for Experian. You are paying other people's mortgages/loans with money you could be using to pay your own.