Credit Card Application

kylesmith10

Hi there,

I'm 21 and living with my parents, I'm a managing director of a limited company and have a salary of just over 16k. I've got Paypal Credit with a limit of £2050 with £850 outstanding, but I pay on time and more than the minimum payment each month.

I sometimes receive mail from my local bank which invites me to apply for a credit card. I've never thought about it until recently. I've been against credit but thought it'd be a good decision to have a card and use it for daily purchases and setup a DD each month to start building my credit score.

I applied for my local bank and they denied my application, I tried my secondary bank and they denied me too along with Barclay's too.

I've checked my credit score and Expedian say it's 960 but Noodle say 530. I've no bad debt on my noodle statement and payments for Paypal and my other direct debits have been paid on time.

Could anyone give me some advice as to why it's getting declined? I'm don't want a card limit which is stupid but a few hundred is a reasonable start.

Thanks

Arleen

You score 4788 according to my scoring system. I don't know what is it's scale, or what are the criteria, so it's very much like the thing offered by noodle and Experian, with the same impact on your actual credit worthiness.

What matter is what is on your application and credit file.
For credit file, you live with parents so that it will be thin, at most the PayPal account and phone contract, not good. No utilities, the internet, etc.
For the application, your income is not great, but you are also self-employed which is a higher risk. You will be best getting a credit builder card, like capital one, or aqua.

Although I wonder why did you need the PayPal credit in the first place, and why do you have any balance on it now?

kylesmith10

Thank you for your reply.

I have PP Credit as I purchased my iPhone through it. Payments are being made regularly and have never defaulted making them.

I understand my salary isn't massive massive and that I live at home, but I have minimal outgoings.

Capital One said they can guarantee acceptance, what are the negatives of a Capital one and is it easy to setup a DD?

Arleen

You can set up the DD during application and then manage it online. It's a normal credit card, with the downside being high apr if you will ever not make a payment in full.
And I am still curious since you have tiny outgoings, why not just pay off the phone quickly? On that salary you should be able to pay it off in 2 months, so why pay any interest on it?

Shakin_Steve

kylesmith10 wrote: »

Thank you for your reply.

I have PP Credit as I purchased my iPhone through it. Payments are being made regularly and have never defaulted making them.

I understand my salary isn't massive massive and that I live at home, but I have minimal outgoings.

Capital One said they can guarantee acceptance, what are the negatives of a Capital one and is it easy to setup a DD?

If you ignore the high APR and low credit limit, there are no downsides to any credit card. You must only spend what you can afford to repay each month, and make sure you set up a DD for the full amount. Even something like a barclaycard, with an APR of 18.9%, is going to make the debt mount up if not payed off each month. Be patient and you creditworthiness will improve.