Low credit score that never improves...

FallOut

I have a total of three defaults, one from 02/2014, another in 04/2014 and the final one also in 04/2014, so we are looking at 05/2020 before they fall off my report, then say a further 4-6 years to rebuild my file, so if we take it down the middle thing might start to improve by around 2025??

Ive tried to apply for a couple of low price items on credit and been refused on both occasions (both items valued under £400) so at a guess if I cant get £400 on credit no one is going to take my application for something of a much higher value (car finance) seriously.... are there any other options??

I!!!8217;ll look into a second card, not really sure what I would use it for, maybe alternate each month between the two, or would that not really help with things as every other month one would go unused.

My main worry now is how will this position me for things like a mortgage, I!!!8217;ll be in my mid 40s by the time things recover, by this point would someone want to lend a !!!8220;first time buyer!!!8221; whos of such an age?? (Not looking forward to telling the g/f that she can kiss goodbye to making any plans in the near future....)

[Deleted User]

FallOut wrote: »

I have a total of three defaults, one from 02/2014, another in 04/2014 and the final one also in 04/2014, so we are looking at 05/2020 before they fall off my report, then say a further 4-6 years to rebuild my file, so if we take it down the middle thing might start to improve by around 2025?

You're misunderstanding how time works.

You can build good history now through sensible used of your card. Don't wait until all the bad history has dropped off before adding good history

Dobbibill

so in 2 yrs it will be as if they were never there on your credit files.

what makes you think it will take a further 5yrs to build history?

Your current account will report to the CRAs. A mobile phone contract also reports, along with utility bills (from some companies). A 2nd CC could be used to purchase travel costs (fuel, train, bus) while your main CC is for groceries. (makes sure you don't pay your CCs before the statement is produced otherwise it will report a zero balance)

You are constantly building history with all the above, coupled with being on the ER, when the defaults drop off the history you have been building now will be remain on your files so evidence responsibile behaviour with credit.

ETA - cross posted with zx81 saying the same thing

Candyapple

FallOut wrote: »

I have a total of three defaults, one from 02/2014, another in 04/2014 and the final one also in 04/2014, so we are looking at 05/2020 before they fall off my report, then say a further 4-6 years to rebuild my file, so if we take it down the middle thing might start to improve by around 2025??

Ive tried to apply for a couple of low price items on credit and been refused on both occasions (both items valued under £400) so at a guess if I cant get £400 on credit no one is going to take my application for something of a much higher value (car finance) seriously.... are there any other options??

I!!!8217;ll look into a second card, not really sure what I would use it for, maybe alternate each month between the two, or would that not really help with things as every other month one would go unused.

My main worry now is how will this position me for things like a mortgage, I!!!8217;ll be in my mid 40s by the time things recover, by this point would someone want to lend a !!!8220;first time buyer!!!8221; whos of such an age?? (Not looking forward to telling the g/f that she can kiss goodbye to making any plans in the near future....)

So in May 2020 your credit files should be clean and free of any defaults. You don't need to wait a further 4-5 years to build up a good credit history, you do this now in the interim years. By using your credit card and paying it off every month so you get those green zeros and increased age of accounts.

I wouldn't bother trying to apply for any mainstream credit until your defaults drop off. You've already seen firsthand that you are rejected for low sums of money and the only options for car finance available to you would be eye watering high APRs which is a no-no. Use these 2 years to save what you can and put it towards a deposit for a better car when your defaults drop off. You have no choice really so you may as well get used to the idea.

If in a few years time you'll be mid-forties, then yes you can still be a first time buyer. The only issue you would have would be finding a lender who would be able to lend past the age of retirement.

List_Maker

Having been in a similar situation as you in the last few years I can only tell you my experience.
I have 4 defaults (early 2013) and another 4 accounts that did not default and were marked with DMP until I paid them off in full (Jul 16)
I waited 6 months after my final DMP payment and applied for a "bad credit" credit card. Using and paying off in full nearly every month. They increased the limit after a 6 months. Will look to switch to a better card that might have offers/rewards after defaults have gone (mar 2019).
I have seen my bank for a loan for a car, and they have used my history in my current account rather than doing a full credit search. So always a good idea to approach your bank if you do really need a line of credit for whatever reason. They can see that I am managing a linked saving account monthly as well.
I booked an appointment and discussed the car loan and a mortgage AIP, both of which they have stated would be available to me,something that I assumed would be well out of my reach, and this is with "normal" rates! I will wait until the defaults drop off before applying for a mortgage.
Ever since I started my DMP, all open accounts have been managed correctly and never an issue. Affordability is also key.
As stated above, time is a healer.