Credit Rating Building

SuperOX

Good Afternoon all!

This has probably been discussed many times, but I am in need of some advice.

I've managed to clear all my debts (horay!) and now just have my monthly outgoings. However, my credit rating is currently listed as "poor". Which is a nightmare when planning on getting a mortgage etc in the future. I have considered taking out a credit card, but the APR stands at 34.9% roughly for my poor rating.

What I have considered is the following: getting a credit card, putting maybe 2 items on this a month (shopping and petrol for example) then withdrawing or moving the money spent from my current account and paying off the credit card when the bill comes through.

What i'd like to know is will this dramatically increase my credit rating and will I get charged the APR if the balance is cleared every month?

Thoughts welcome!

[Deleted User]

You've got the right idea and over time, you'll build a solid credit history that will stand you in good stead. You won't be charged any interest, as long as you don't make cash or cash-like transactions.

Ignore your credit score as a means of measuring your credit worthiness though, or it may lead you into taking incorrect actions.

SuperOX

Thank zx81, does that mean in reality, if I can pay off the balance then it does not matter what the APR is?

glentoran99

SuperOX wrote: »

Thank zx81, does that mean in reality, if I can pay off the balance then it does not matter what the APR is?

yes it does, do not be tempted to leave any balance or you will pay dearly for it

[Deleted User]

Correct.

It can be a million % (and if you get a Vanquis card, it may well be!), but it's irrelevant.

I'd advise setting up a full pay DD so you don't get caught out. (Bear in mind it might take a couple of statements for the DD to start taking payments.)

DCFC79

If you pat the card off when it's due you won't be charged interest.