Help me understand please!!

Marv60

Ok I need some help please!

Just to give a bit of a background, around a year ago I got myself in some serious trouble with Credit Card debt, I mean approx £20k bad, to the point I was struggling to pay it back. Where I was getting debt collector letters. Thankfully I was able to get help from my parents where all the debt was cleared, I cancelled the cards (one stipulation my folks said I had to do to get the help), got help I needed and I have a plan in place with my folks to pay them back the money.

After I started to rebuild my life and grow up and take control of my finances, I started to look at credit scores and try to understand it. As you could imagine my score was shocking.

However I was able to get myself a credit builder card with a low credit limit, my choice, and I used it for work expenses only and paid the full balance statement every month.

My score slowly start to increase to the point it was in the 'fair' category. However when Christmas holidays came along I paid my full balance off as I got the money from work for my expenses. The card had nothing spent on it for over 3 weeks as I was off work for the holidays, and this month when my credit score updated it had dropped by 100 points and I'm struggling to understand why?

I haven't applied for any new credit, no searches appear on my credit report that would have an impact on it. My mortgage is up to date and I have no other debt.

Can anyone shed any light on this please?

[Deleted User]

It's fine.

The score doesn't measure credit worthiness. It's made up and will shift randomly.

No one sees it but you so just ignore it.

Focus in managing your credit responsibly.

SlovakianGuy

Marv,which score / report did you check? Don't forget to check all 3 reports on Noddle, ClearScore and Experian / MSE Credit Club. All these are for free and you should check them every single month to make sure there are no mistakes that could cause you problems.

SlovakianGuy

Btw, it's not just a credit application that may cause the change. It can be many things such as getting on or off the electoral roll, change in your credit utilisation ratio, late or missed payment (make sure they don't put any of these on your file by accident), closing any account or contract, etc.

Marv60

Thanks, I’ve been working like a demon on that and managing money responsibly as well

Marv60

I check my ClearScore and MSE one. Not carried out a check in Noodle. Also checked for everything you said there and the only thing I can see is my utilisation was high for a month due to paying my professional fees, which were then paid off when claimed back from the work to which I’m showing 0% utilisation as I had paid the card off and wasn’t using it as I was on holiday.

[Deleted User]

Nothing you have described will worry lenders. Credit scores, especially Experian's, punish change. - such as a drop or increase in spend. Lenders only worry about negative factors.

Carry on clearing your card each month ,. - it demonstrates responsible credit management.

Marv60

Thanks, was worried in case I was doing something really stupid and not knowing it. But if it goes down cause I clear it off then so be it as I’d rather have a low score with manageable debt than go back to what I was doing!!

SlovakianGuy

OK, don't worry about it. Just carry on, use that card responsibly so you have nice "Payment OK" on your file for every month. Lenders don't see the number (your score), each lender calculate their own score using their own criteria, so don't worry too much about it. I must admit I like to see my score going up too but I know it's not really important. It should be just an indication of what the credit reference agency thinks about how a potential lender would see you. Oh, and of course, it should help them to sell you some product to "improve your score" too

Marv60

Cheers folks, feel better now