does Paying off CC over 12 months or get a loan to pay the cc improve credit score?

dannymcg82

Hi
firstly, sorry for long title. i'm trying to ascertain what route would would improve my credit rating with the greatest ascendancy over a 12 month period.

Some background. after many years of cleaning up my credit after many rash years i'm now in a good position but want to improve. i would like to get a mortgage in 18 months time and want my credit rating to be as good as it can be.

I have around £2800 to clear across 2 credit cards, they both have a similar interest rate. I would like to pay these off and get saving for my mortgage deposit.

Therefore, i would like to know which option would gain me a better credit score over a 12 month period. pay off directly over a 12 month period or take a loan for the amount and use put a small amount on the cards each month and pay them off in full.

your thoughts would be appreciated.

thanks

sourcrates

Hi,

Welcome to MSE.

The answer is neither option will benefit you in the real world.

Google "credit scores" or read some of the posts on this forum, only you ever see your credit score, lenders certainly don't.

It's credit history that counts, pay your bills on time, don't go over limit, certainly don't default, be on the electoral role, common sense things like that.

dannymcg82

thank you for your swift reply. will pay down gradually over the year.

i did read somewhere that keeping your credit amount available to roughly 70% is the golden number, i.e. 700 available on a 1000 limit. any truth in that?

just a quick question. just how adversely does it affect your credit if you happen to move about a bit?

i'm always on the electoral role but move every year or two for work.

thanks

sourcrates

dannymcg82 wrote: »

thank you for your swift reply. will pay down gradually over the year.

i did read somewhere that keeping your credit amount available to roughly 70% is the golden number, i.e. 700 available on a 1000 limit. any truth in that?

just a quick question. just how adversely does it affect your credit if you happen to move about a bit?

i'm always on the electoral role but move every year or two for work.

thanks

To be completely honest with you I have no idea.

The only information recorded on your credit file is if you pay on time or not, everything else is open to the individual interpretation of anyone who chooses to read it.

You can't please all of the people all of the time, so don't try.

wjr4

Personally I would just concentrate on paying off the cards. I wouldn't recommend getting a loan (if you were accepted) to pay them off.