Aqua for newbie credit building, any good?

brampty

Hello,

I've never had any form of loans or credit cards, as I've always paid for everything with my debit card, even bigger purchases like tumble dryers, flights and so on. All my bills have been paid by direct debit without fail, and I've never owed anything anywhere, so I've always assumed that my credit rating would be at least "okay", but a colleague of mine has told me that will get me nowhere.

Therefore I've looked around and found an Aqua Reward card which gives cashback, which sounds okay for me as I'm not interested in any balance transfer, 0% on purchases and whatnot.

I've done their online sign up where they "checked me" and I've immediately afterwards got an email saying "Thank you for applying for the aqua Reward credit card. Your application was successful and you will receive your card and PIN separately within the next 5-10 working days."

Is that truly all there is to it? They haven't asked me for anything really.

Additionally, what's now the best way to "build" credit with this card? I will always pay it in full via direct debit, but I don't know how much I should ideally spend on it to improve my credit rating? Up to 50% of my introductory limit? Less, more?

My Noddle score is 590, and my Experian score is 913, if that matters.

Thanks in advance

[Deleted User]

Use no more than half, clear in full once you get the statement.

Ignore your credit scores as they're meaningless and not seen by anyone, just manage your credit responsibly.

brampty

Good stuff, will do!

Thanks a lot!

Kim_13

Your credit file will have something there, as it will show your current accounts and some of your bills should be on there to demonstrate a good payment history.

That said a credit card will help you to improve it further provided it's used as stated above, plus it can protect large purchases in future. This article about Section 75 protection will help you: https://www.moneysavingexpert.com/shopping/section75-protect-your-purchases.

Section 75 is always preferable to a chargeback if the purchase is eligible. There's also the added bonus of cashback on purchases with the Aqua Reward card.

brampty

Is the credit file something different that a credit report, as I haven't been able to find any information about any of my utilities, ever? I'm assuming it has to exist somewhere, especially since Aqua has immediately approved me for a card without me having to provide them with anything. But then again, it's Aqua, and from the sounds of it they accept anyone, so I shouldn't think too much about that, hahaha

Section 75 sounds like a great thing, thanks for the information!

Neil_Jones

Much like fire, credit will either aid you or burn you.
The Aqua card is fairly easy to get and the easiest way to build credit is to use it responsibly - such as not going overdrawn and ensuring you pay the card off in full by direct debit every month. Where possible only using half the credit helps, though this card tends to start with low limits initially (possibly as low as £250) so that may not be an option in the early days, though as your limit rises it becomes easier to stick within 50%.

You get a letter every few months offering an increase in your limit if you've been good with it, and of course remember to pay for everything you can on the card to maximise your cashback, because this card pays it on everything you can shove through it. Some of the other cashback cards available can limit what attracts cashback.

brampty

Well, I don't spend a lot anyway, so the limit isn't that much of a big deal. I'll just use it up to half of the limit, and pay the rest with my debit card as I've done for years now

Kim_13

brampty wrote: »

Is the credit file something different that a credit report, as I haven't been able to find any information about any of my utilities, ever? I'm assuming it has to exist somewhere, especially since Aqua has immediately approved me for a card without me having to provide them with anything. But then again, it's Aqua, and from the sounds of it they accept anyone, so I shouldn't think too much about that, hahaha

Section 75 sounds like a great thing, thanks for the information!

Credit file and credit report are essentially the same thing, the report is the terminology used when you ask a CRA for a copy.

There are three Credit Reference Agencies, Experian (free via MSE Credit Club), Equifax (free via Clearscore) and CallCredit (free via Noddle.) Not all lenders report to the same one(s), so an account may not appear on one but will on another. In terms of bills, phone bills and the like are more likely to appear than utilities, who aren't usually providing any credit. Any catalogue credit accounts you may have would also be there.

Aqua are a subprime lender (hence the high interest rate) so are more likely to accept those with limited or bad history.

Dobbibill

Be mindful that paying in full by direct debit means by the time the direct debit is taken (normally about 3 wks after the statement is issued), you will have used more of your limit the following month.

By only using 50% of your limit per month, it should be approx 80-90% of the limit by the time the direct debit pays the statement balance.

Get a good routine going from the start, then repeat.