Credit Card / Building Credit Rating

LupusWolf

I really don't want to be in debt, but I have a low credit score and one day want a mortgage.

Is this correct? I get a credit card, with eg: £1000 limit. I spend £50 per month on that credit card. When the statement arrives it says I only have to pay off £5 (as an example) but I pay £50. Do I get charged interest if I pay the full amount off before the date I have to pay the minimum amount off?

I want to get a credit card and spend very little on it, and pay it off on a monthly basis to build my credit rating. Does the above work? I do not want them getting any more money then they have to off me.

Linda32

If you pay the full amount spent when the statement arrive then No they will not get a penny off you.

What you need to do is apply for a credit card and then set up a direct debit to take the whole amount. That way, if they don't collect it, it is their fault not yours.

If you only pay say £5.00 of the £50.00 spent they you will pay interest. If you pay back the whole of the £50.00 you will not pay a penny interest.

TheShape

The vast majority of cards will not charge you interest if you always clear the full statement balance. There is at least one that charges from the date of purchase, so always check the summary box and t&cs.

Set up a direct debit and check your statements to ensure that they state payment will be collected by direct debit, this is especially important to check on your first statement as there is sometimes a delay in setting up a direct debit.