Improving my credit rating for a mortgage.

AddictedSaver

I don't have any CCJ's but I do have unpaid debt that I'm going to be paying off shortly. As for my credit score itself, how does one improve the rating so I can get accepted for a mortgage?

My younger years were filled with late payments, cancelled direct debts and a bunch of firms chasing after their money. For the last 5 years however I have 4 direct debits and I've never missed a single payment and I don't have any credit card debt. (don't own a credit card).

So what is a real basic simple way I can improve my credit rating once I have paid off the outstanding debt on my record?

People say to apply for a credit card and then just use it, this will build up my rating, is this true?

National_Debtline

Hi

Your rating is just a rough guide created by the credit reference agencies and isn’t something that would be seen by potential mortgage lenders. Lenders will look at the information on your file rather than just checking whether you have a high credit rating, so don't get too hung up on the number itself.

The longer ago that your late payments and any defaults were the better, and once they come off your file after 6 years they will no longer have a negative impact. Keeping up with your current payments and saving up for a deposit are really the best things you can do to help with a mortgage application. Make sure you're on the electoral roll and any previous address information is correct on your credit files. If you don’t have a Help To Buy ISA it a good idea to start one as it will help with your deposit.

If you take out a credit card, spend a bit and pay it off in full each month it might help. It shows that you’re making debt payments on time and you’re in control of your finances.

James
@natdebtline

mwarby

I'd think that other than any negative history, which lessens with age, the biggest factor is affordability and deposit. After clearing debts the more you can save for a deposit the better.