Rebuilding credit rating

Baron_Greenback

hello there,

I was discharged from bankruptcy last year and I'm taking steps to improve my credit rating, I've started to 'clean up' my credit file and I'm now looking for tips on how else to improve my credit file.

I've read the article on this site about improving your credit rating, but i found it did not answer all my questions.

Would saving regularly (e.g into an ISA) improve my credit rating?

I have heard that having direct debits on your current account can improve your credit rating - is this true? And if it is true, is it a case of 'the more direct debits the better', or would just having one or two direct debits be good enough?

I never go overdrawn any more, but I often have only £10 or so in my current account towards the end of the month. Does the amount in your account affect your credit rating? In other words, would I be better off trying to leave a healthy amount in the account at all times?

I am not going to try to apply for credit for a good 6 months, until the effects of my 'clean up' kick in, at the moment I just have a basic account at Abbey and a mobile phone contract (from pre-bankruptcy days, I would definitely be turned down if I applied today).

So, bearing this in mind, can anyone share any experience of how they managed to rebuild their credit?


Thanks in advance

Baron_Greenback

Nobody knows anything about rebuilding credit after bankruptcy then?

betterlatethannever

Not got as far as rebuilding my credit rating yet BG.
I did look it up and can't find any info i can trust. Most of its from companies that charge you to re build.
One thing i heard on here was they like to see lots of activity on your account. I heard that you withdraw some money from the ATM then go into the branch and pay it back into your account.
Have you got a pre pay card? that might help but i don't know for sure.
Sorry can't be of any other help.

fiveyearplan

I'm not bankrupt yet so I'm not speaking from experience. You could try getting a credit card (ones that have incredibly high interest rates!) but be sure to pay it off in full every month so you don't have to pay the interest.

Baron_Greenback

fiveyearplan wrote: »

I'm not bankrupt yet so I'm not speaking from experience. You could try getting a credit card (ones that have incredibly high interest rates!) but be sure to pay it off in full every month so you don't have to pay the interest.

Unfortunately i have tried and failed to get one of the 'high interest' credit cards, am in the process of 'clening up' my credit file but until this happens I am looking for any other advice on how to improve credit rating.

Baron_Greenback

betterlatethannever wrote: »

Not got as far as rebuilding my credit rating yet BG.
I did look it up and can't find any info i can trust. Most of its from companies that charge you to re build.
One thing i heard on here was they like to see lots of activity on your account. I heard that you withdraw some money from the ATM then go into the branch and pay it back into your account.
Have you got a pre pay card? that might help but i don't know for sure.
Sorry can't be of any other help.

Thanks for the reply

Yes i have heard this about having a lot of activity on the account, but I'm trying to find out whether is it truth or just a myth, as information about exactly how the credit reference agencies operate seems to be in short supply.

I have got a pre-pay card (purely for internet purchases) but I'm pretty sure these have no effect on your credit rating.

Miss_Marple_2

I don't really know, but when I looked at my credit file - my bank accounts listed only that I had no overdraft, not what the balance is. There also appeared to be no reference to savings accounts, so not sure how those would be found out about other than if you were aksed about them (but maybe creditors see more information than we do from our file)

Lizzibuff

I used to work in a credit dept - (long time ago) from what i remember the credit reference agencies that we used didnt have access to your bank accounts - so wouldnt have details as to how much was in your account etc.

Information recorded would be such things like - use of odraft, charges paid on time, monthly payments made on time etc.

From my experience the best way to build credit is to use a little and make sure you make regular payments and on time.

You say you've applied for a credit card but been declined - poss try applying for something with your bank - they will have more access to how you use your account and will be able to see regular useage of the account - which should go in your favour. This may make them more inclined to give you credit - this hopefully will then look good on your credit file and you can then work towards re building it again.

I think someone also suggested pre-pay credit card - this may help also tho i've personally never had any experience of those- Good luck and let us know how you get on.

betterlatethannever

From the info i've gathered it seems a pre pay card doesn't improve your credit rating as they don't report back to the CRA.
I think Lizzibuff suggestion of applying to your bank is a good idea.
I also read that a credit rating is improved by applying for cards, though only if you apply about every 3 months.
Its a tough one; your BR and that means no credit for 6 years. Best you can do is keep trying every now and again until one day they say YES!

tigerfeet2006

If you can get a contract mobile that might help.

Baron_Greenback

Thanks everyone for the advice - I think I'll just keep trying every few months and maybe eventually it'll improve.

I've already got a contract phone from before bankruptcy and this doesn't seem to help much. Might wait until my defaults are all listed as satisfied and then try again for a Vanquis card.