Young First Time Buyer - should I get a Credit Card?

Awswish17

I am 22 and have just left university. I have been saving for nearly a year into a Lifetime ISA along with my girlfriend and am looking to get our first house together in the next year.

We have saved up enough for a good deposit but sites such as ClearScore have us rated as average credit score. We have never borrowed money, been overdrawn or been in any real form of debt (other than the student loan).

To get the best mortgage deals and have more than simply an average credit score, do we need to both get credit cards and start building on this to be accepted for a mortgage? As we are both starting out in work we want to maximise the amount we will be allowed to borrow as our salaries are relatively low compared to the amount we can put down as a deposit. If we are looking to get on the ladder in the next year, will getting a credit card make a big difference in how much we are able to borrow for a mortgage and therefore the price of property we’ll be able to get?

spadoosh

Your credit score is a made up number that has no bearing on someone willingness to lend you money. Our credit history is more important.

A credit card is never going to increase the amount of mortgage you can get. That will largely be dictated by affordability. What a credit card does do is show a lender that you stick to your financial commitments. Im not sure how detrimental a lack of CC will be in applying for a mortgage but if on your credit report there is little dealing with financial institutions they might be more reluctant to lend to you.

For the sake of having a credit card, using it a little bit whilst paying it off each month to show a more committed financial history its probably worth just getting one. I would like to think it wasnt absolutely necessary though if you tick all the other boxes but cant be sure on that.