Help foreign boyfriend build credit

luiza8

My boyfriend has just moved to the U.K. from Italy where he is an Italian Citizen and lived all his life. He moved to the U.K. in the middle of August.

He has opened a Starling bank account and a Lloyds bank account. He was unable to get a Classic account (free one from Lloyds) due to his credit rating. They only offered him the most basic account. He wanted a second Lloyds account but the credit check failed, so he will have one bad result on his credit file already.

We are wanting to get a mortgage in 5 years or so, so I'm keen to get his credit rating built. He is currently unemployed and I'm supporting him. He has a mortgage on a house that he is renting out in Italy.

I know he can build his credit report with a credit card and make small purchases and pay them off every month, however he won't qualify for a credit card if he was declined for a Classic account with Lloyds. How can he grow his credit rating? I know he can register on the Electoral Role as he is an EU Citizen resident in the U.K..

Any help appreciated.

jimbo26

Being unemployed is not helpful, as it will make it difficult, probably impossible to obtain credit. Who is going to lend to someone who has no income?

1. He really needs an income

2. Get a SIM only contract that will report to a CRA (I know 3 do, and maybe others)

Once 1 and 2 are accomplished try a credit building card like Aqua, Vanquis or Capital 1.

luiza8

Thanks for your fast reply!

Yes, he is actively looking for a job, and I'm sure that should help things. How do the credit reference agencies know when he gets a full time job?

SIM only contract? I know ID Mobile offer a 1 month contract that requires a credit check (I used to have this), but the service is terrible in the area. He has a GiffGaff SIM, however that's not a contract and comes off his debit card every month. Can you list the 3 that you know of please?

jimbo26

3 is the company http://www.three.co.uk/

The CRA won't know he's employed, but when you apply for credit they ask your income and occupation. When he says unemployed and £0 income they will not be overly keen to lend to him.

Voyager2002

Don't worry: five years is a long time!

He needs to find a job, any job, before he starts applying for financial products. Once he has been employed and resident here for six months he will qualify for a 'basic' credit card such as Vanquis, and responsible use of this will make him attractive to most financial services providers in about a year.

In the meantime, he is self-employed (with income from the property in Italy) rather than unemployed. However, his priority should be establishing himself in the UK labour market rather than building his credit record -- that is something that will happen naturally over the next couple of years.

antrobus

Voyager2002 wrote: »

....

In the meantime, he is self-employed (with income from the property in Italy) rather than unemployed. ....

Income from property does not constitute 'self employment' in UK tax law.

nobile

Is he entitled to any benefits (JSA etc)?

[Deleted User]

If he’s not a British citizen then no he shouldn’t be entitled to any of our benefits system

shortcrust

!!! wrote: »

If he’s not a British citizen then no he shouldn’t be entitled to any of our benefits system

Thankfully it's still a little more nuanced than that:

https://www.citizensadvice.org.uk/benefits/coming-from-abroad-and-claiming-benefits-the-habitual-residence-test/eea-nationals-and-the-habitual-residence-test/eea-nationals-claiming-benefits-as-a-jobseeker/

To the OP - Five years is plenty of time to prepare. In 12 months max he should be able to get a 'standard' bank account, and a bank issued credit card should follow fairly soon if he's got income. I wouldn't worry too much about the credit report for now. Just focus on him getting settled and active in the labour market. Electoral roll, and perhaps some telecoms or utility bills will help to build his profile.

DCFC79

luiza8 wrote: »

Thanks for your fast reply!

Yes, he is actively looking for a job, and I'm sure that should help things. How do the credit reference agencies know when he gets a full time job?

SIM only contract? I know ID Mobile offer a 1 month contract that requires a credit check (I used to have this), but the service is terrible in the area. He has a GiffGaff SIM, however that's not a contract and comes off his debit card every month. Can you list the 3 that you know of please?

The credit score is only seen by you or your bf, lenders see the history.


Reference agencies have no need to know about a job but he does need to get 1 so he can have money going into his bank account which will put him in good steed with them who will then report to the credit reference agencies if your boyfriend is in debt or not but more importantly a wage would mean he would be able to apply for say a phone contract in the future.

Voyager2002

antrobus wrote: »

Income from property does not constitute 'self employment' in UK tax law.

True, but this thread is not about tax. If he applies for a financial product the provider will be interested in his income, and that it is not a state benefit.