Credit rating has dipped 80+ points in the past 2 months

lara24

Hi All,

In April, I received notification from Experian that my credit rating had gone into the 'Excellent' range. I had been thinking about getting a car so I took out a car loan from Admiral: £8.5k at 3.2% APR for 5 years.

I'm pretty clueless about personal finance but I'm trying to learn more, I watched a YouTube video which recommended having different bank accounts for different purposes, this is to help you budget your money better, it actually works pretty well for me. I already had a current and savings account with HSBC, and I opened 2 further current accounts with HSBC and Monzo.

In the following month after taking out the loan and opening the accounts my score fell by 40+ points. In the next month, it fell by another 40 points even though nothing changed from the previous month.

I signed up to CreditExpert (an extention to the free Experian account I already had) and its let me know that I have 5 positive factors and 1 negative factor on my credit score. The negative factor is 'You have opened 1 new credit account in the last 6 months'

EDIT: This negative factor was due to HSBC doing a 'hard search' on me. That would explain why the rating fell in the month that followed but why is it continuing to fall?

Is there anything I can do about this?

Also, I'd like to set a direct debit with a local gym but I have not clue if they will do a hard or soft search.

Thanks,
Lara

forgotmyname

Random numbers can randomly change.

Improve the score> Dont pay your bills on time because mine when down when i did that. Roll a dice instead and use that to work out your new score.

molerat

Any change to your file will cause your randomly generated score to fall and you had lots of changes in a couple of months. I am sure if you pay CreditExpert some money they will tell you how to improve it.






Alternatively don't give them any money, keep paying your bills on time and your score will magically improve.


I do hope you have cancelled your subscription, you do not need to pay for any of these services.

[Deleted User]

It's due to the World Cup.

Everyone is fighting for the points.

daveyjp

Looks like that initial marketing email from experian worked.

Thats all the scores are about. Getting signed up members to take on credit.

PixelPound

daveyjp wrote: »

Looks like that initial marketing email from experian worked.

Thats all the scores are about. Getting signed up members to take on credit.

Getting people to sign up to subscription services - Experian etc don't offer credit

daveyjp

I know they don'toffer credit, but they earn revenue by working with those companies, such as Admiral, who do.

Thrugelmir

lara24 wrote: »

Is there anything I can do about this?

Don't believe the hype. Simply act financially responsibily and all will be fine.

Ben8282

lara24 wrote: »

Hi All,

In April, I received notification from Experian that my credit rating had gone into the 'Excellent' range. I had been thinking about getting a car so I took out a car loan from Admiral: £8.5k at 3.2% APR for 5 years.
Thanks,
Lara

daveyjp wrote: »

Looks like that initial marketing email from experian worked.

It sure does. She got an e-mail from Experian telling her that her credit was now Excellent so she went out and got a loan because of it.


To OP.
Ignore the score.
Check the content of your credit files.
If there is nothing untoward there you have nothing to be concerned about.
With regard to the recent drop in your score, although the score is in itself meaningless this may well reflect the fact that in taking out a loan for £8.5K you will have made yourself less attractive to potential lenders in that you now have £8.5K debt and a new monthly financial commitment for the loan repayment
If you were to apply for another £8.5K loan tomorrow the chances of you getting it are now lower and the chances of you getting a low APR (assuming that you can actually get the loan) are now lower due to the new debt and new monthly financial commitment.