Rookie in credit cards spending for credit score

harrystroe

Hi everyone, the short story is, wanted to open a student account with Santander, was declined and since my credit score is fair I decided to apply for credit card in order to build the credit score for future financials.
I know, read, understood about how the credit score is situational, but still, I think having some credit cards although my financial status doesn't t need it, are a good way to have a healthy financial in lender's eyes.
So.. I applied and get the following:

Capital One - 500 £
Aqua - 900 £
Amazon classic - 900 £ - been working at Amazon and having discounts I took this for Amazon expenses

Now, please feel free to have your thoughts on how would be the best way to spend in order to secure a good "credit score". either we talk about casual expenses or normal ones

Questions: Setting direct debit obviously to pay in full the balance at the end of every month is seeing as a good choice. But also I 've seen advice as paying the full balance right after the statement, which could not be at the end of the month..so I am confused about this.

Thank you in advance and any advice would be great to acknowledge.

[Deleted User]

Ignore the scores. They are made up.

Use the cards for normal monthly purchases and then pay in full each month after receiving the statements.

This will build your credit history

Terry_Towelling

Stop worrying about your credit score. Most on here will tell you it is nothing more than a gimmick used by the credit score providers to sell you things.

Just use the card for your normal expenditure and pay it off in full by whatever means you wish. Personally I would wait until the last minute possible to pay the balance (DDR to do this) because that allows you to keep your cash in your bank account earning interest for you.

Live your life and forget you ever heard of credit scores.

harrystroe

I am not worried about credit score after Santander declined my student account, I 've been approved for a 5k loan with 5 % interest on 5 years by a no-name lender, which obviously doesn't t make any sense regarding credit score.
My main interest is still to have a good history of repaying debts, which probably in the future will be a good thing.

[Deleted User]

The loan won't look good on your file though

harrystroe

meaning? I need it not entirely, and I was thinking of paying monthly will secure the "good borower" status . sort of speak.

[Deleted User]

No - a loan makes you look desperate for cash.

Please don't tell us you took it out purely for that reason...

You now have that loan on your files for 11 years potentially now - the 5 years it's being paid off then 6 years from the date it's settled/closed.

Ben8282

If you don't need the money then why are you paying interest to borrow money that you don't need. The existence of this loan will be shown on your credit files and the debt will adversely affect your ability to obtain further credit until it is repaid.
If you have been able to obtain 3 credit cards albeit with low limits and a 5K loan at 5% APR then there cant be very much wrong with your credit files. Stop worrying about nothing.

Terry_Towelling

This is very odd behaviour and shows how easy it can be for people to be sucked in by the marketing hype surrounding credit scores and credit histories.

I agree it can be difficult to accept advice from strangers - especially on a forum like this where people could be telling you anything from the truth to a pack of lies but you do need to consider the general tone of advice that is coming your way - and that is to ignore your credit score and just get on with life.

Taking an unneeded loan to improve your position is very strange. The best thing you can do now if you want your history to show you're a good loan risk is to use the loan to pay it off immediately before the interest starts to rack up. It will costs few quid of your own cash but better that than several hundred quid.

harrystroe

Before anyone starts to panic please understand that i need that loan but not the entire sum, I took it as the best APR offered, lower amount on high apr or more money didn need it.
Now as a logical thing please explain how history will show that I am on lower loan risk IF i never took.a loan? I mean ..this loanis useful, never had one, indeed it might be seen as an bad move but I doubt it .
Thank you anyway for your advices, for sure I ll take in consideration.

Nebulous2

A loan is fine if you got it at a good rate and you need it. It will help you build a positive history. It looked as though you had taken it only to build history, which isn't necessary.

If you didn't need it all you can overpay to reduce the period and the amount of interest you will pay.

It may limit the amount of money you can borrow, for a mortgage for example, until it is repaid.