Credit Score Building

pstewart11

Hi I am looking for some advice, I am considering applying for a mortgage. I have a problem in that a credit agreement I co signed with my parent was defaulted, however this default is 6 years old in August 2017 - and I understand it will fall off then. Other than this I have a good credit history, no outstanding debt, never missed a payment in my life and am trying to build my credit score between now and the end of the year. I changed my address details on all my accounts as I moved house, and as the Electoral Office haven't updated their details for me, my credit score has fallen 52 points.
Will this be rectified when my details are updated on their system? I am very much panicked by all this Credit Score information. Thanks in advance.

Ebe_Scrooge

First off, ignore your score - it's meaningless, and is seen by no-one except you and the CRA.


If you want to improve your credit history ( which is what lenders will look at ), the basic steps are :


1. Make sure you're on the Electoral Roll. Note that it can take a few months after registering before this will appear on your file.
2. Defaults are never a good thing, but they will drop off after 6 years.
3. The simplest next step is to apply for a sub-prime credit card, use it regularly for day-to-day spending ( fuel, groceries etc. ) and make absolutely sure to pay in full, on time, every month when the statement arrives. A Direct Debit is the easiest way to do this.


Basically a lender is looking to see a history of responsible borrowing and repayment - someone who borrows within their means, and always pays on time.


Don't worry about the sky-high APRs on the sub-prime cards - since you'll be paying in full every month you won't pay any interest.


After a year, maybe 18 months or so, of responsible credit card usage, your credit history will begin to look a lot more healthy.

[Deleted User]

The only thing you need to know about credit scores is that they have no meaning. Don't worry about how they fluctuate.

However, having your ER details correct gives lenders more confidence you are who you say you are. Find out when your council updates the CRAs - it may be some months before they do so, so you might want to ask if they can accelerate it for you.

pstewart11

Thank you for this - really helpful.
I do have a credit card - I cleared the balance at the start of the year and use it for one or two things and pay in full at the end of the month. I have a really good history of making regular payments, and a number of settled credit agreements - all with payments made on time and regularly.
I was concerned that the number had dropped down, just because my Electoral Roll details have not been updated. I will ask them to accelerate updating the CRA's if I can.