Credit after a DRO ends

Mayforher

Hi everyone :T

Couldnt remember my old log in details so have joined again...I was trying to be debt free wannabe foe many many years and last year I decided to seek advice from CAB before I got into CCJ territory etc...

I applied for a DRO and am pleased to say it got accepted on 14th September so now its just a case of waiting.

Talking to my partner and my dad, they seem to think i will be able to apply for credit to build my credit back up sooner than the 6 years it takes for the defaults to drop off your credit file.

I'm talking about tiny credit with high interest, paid IN FULL straight after using so that my credit report starts to grow onto the green again...

Just wondering if this is true or not? Will I be able to build my credit rating up within the 6 year period (obviously after the 12 month moratorium period) or will I only be able to get credit once everything has come off my credit report?

Hope that makes sense and thank you!

National_Debtline

Hello there and welcome back to MSE,


This is tricky to answer definitively, but I think it is important to say you need to be cautious - as you say you will be. Obviously during the moratorium period, you cannot have more than £500 worth of credit without first declaring the DRO, so you are wise to wait until the DRO is done. The defaults will show for 6 years from the default date and the DRO will show for 6 years from the start date, so you may find it harder to get credit whilst the DRO shows (as opposed to the defaults).


It is difficult to say what a lender will do as your history is constantly influenced by many factors to give you your overall rating. Future lenders don't see the score generated by the credit reference agencies, they only see your history. Your history shows things such as whether or not you are on the electoral role, anyone you have financial associations with and, of course, your financial history.



These factors, mixed with your application for credit/ affordability, will be assessed by the lender's computer to determine if you qualify for credit or not. You can ensure you are on the electoral role, and are not associated with anyone you no longer want to be. You also need to bear in mind that searches will normally show on your file for 12 months, so if you do apply and it is declined, it doesn't mean you couldn't try again later. Just ensure that you are careful about what credit you get, and how much you use. Best of luck,


Laura
@natdebtline

sourcrates

It’s unlikely as you will still have the DRO on your credit report for a further 5 years, plus the defaults from the debts included in the DRO, even though they will be satisfied, most credit providers will turn you down, probably only someone like bright house will offer credit to you.

Mayforher

Thank you both, all very helpful! I am not interested in actually getting any credit at all ever again apart from a mortgage one day, but I understand that to do that i may have to rebuild my credit and am just trying to get an idea of how long that might take. Think I might as well just save like a beast for 6 years for the biggest deposit I can get and go from there! Seems like such a long time but that's life I guess! Was just wondering if i would be able to get a little head start before the 6 years was up

Thanks again!

Craig1981

after 12 months, you should be able to get a high APR credit card like aqua, marbles, Vanquis etc.
We got one each 12 months into our IVA.

you will start to see improvements after the 6 years, but, once that comes, at least you have a credit card, which you have no debt on, paying off in full each month, and a lengthy 5 year relationship with

but before applying for further credit, you must make sure your ready to manage it and budget accordingly as so not to get into debt again