Building credit

Mchad2

Good afternoon all.

I am now happy to say i am debt free for the 1st time in 10 years.

I habe 1 credit card which i have used for building credit and have always kept the balance at £0 with a credit limit of £250.

Would increasing this limit but keeping the balance at zero help my credit rating? If i have previously tried to up the limit on the card but failed, and recently have found out i can actually increase the limit, does this mean my credit rating is improving?

Many thanks

pcman1985

To build a credit rating you need to USE the card, even if it is just £5. Wait until you get the monthly statement and payoff the balance in FULL. Do this every month.

Keeping the card at a balance of zero is the same effect as having no credit card on your credit file.

pcman1985

Also try to keep the balance at no more than a 1/3 of your limit. So about a balance of £80 on a £250 limit.

Mchad2

Sorry...i should have added i used the card for a while...maxed it out. Paid it off and then kept using £10 a month and paying it off. Does the fact i can increase the limit means it is working?

Thanks

[Deleted User]

It means the lender is considering you a better risk and the regular monthly updates on your file will show you can handle credit better.