Which credit card?

edited 30 November -1 at 1:00AM in Credit Cards
14 replies 1.4K views
SesleaSeslea Forumite
15 Posts
First Anniversary
edited 30 November -1 at 1:00AM in Credit Cards
Please dont jump on me for this post, just feeling a little overwhelmed :)

As I posted on the credit file board, I'm currently saving to buy a home in around 12 months. I'm currently living with family so I have no utilities in my name. I've moved current accounts to get a switch bonus and opened another for 5% interest for a year, so my current account history is short. My phone is PAYG, I dont use my overdraft, have around 5k credit with a store card/mail order that I pay off immediately after any purchases and a purchase loan that I pay monthly.

I've decided to go for a credit card to build up my credit history. I've done the wallet workout thing on the MSE credit club site and still feel completely overwhelmed by what was on offer.

I'm saving hard at the moment so not going on holiday and therefore dont need a travel card. The other two categories it suggested were cashback and balance transfer. Obviously I have no balance to transfer but the cashback cards were all Amex and I know they're not accepted everywhere and some included a fee.
I was just going to apply for a First Direct gold card but it said it's good if you're going to make a big purchase (guessing it's because it's 0% for 17 months) then I started overthinking about why it wasnt on the MSE site.

I think I probably am just overthinking and should just go with anything as I'm not making a large purchase but just wanted to hear some opinions on whether or not there is a particular card I should be going for?

Sorry for the long-winded post!


  • zx81zx81 Forumite
    32.6K Posts
    Part of the Furniture 10,000 Posts Photogenic Name Dropper
    There's two things to consider.

    What cards you would like. And what cards you can get.

    Use an eligibility checker to narrow it down.
  • nic_cnic_c Forumite
    2.6K Posts
    Part of the Furniture 1,000 Posts Name Dropper
    Look at a few eligibility checkers to see which cards you can get.

    For cashback, the Amex is good, you can get fee free one, but its 5% for first three months, then 0.5% up to £5Kand 1% for spends above that, plus you need to spend £3K over the year to get any cash back. So unless you have some big spends or will be spending on average of £250 every month and paying off in full each month then it might not be for you.

    If it is just to show a history of responsible borrowing then any card will do that gives the normal 56 interest free and simply pay off in full each month.

    You could get a 0% spend card and spend on that and use the money you would have spent put to overpaying your loan or put into savings. Of course you need to think how you will clear the balance when the 0% ends.
  • pinknsparklypinknsparkly Forumite
    511 Posts
    Sixth Anniversary 100 Posts Name Dropper
    If you are purely wanting a credit card to build up your credit history, then the most straight forward option is to apply for a credit card with the lender that you bank with. They know your credit history (at least with them) and are very likely to offer you something (even if it's a tiny credit limit). When you apply, make sure you set up a direct debit as part of the application process and set it to collect the full amount each month. Since you'll be paying off the full amount each month, then the interest rate is meaningless as you won't be paying any interest!

    If you want an additional perk then you could consider applying for a Tandem credit card (and can use the MSE eligibility checker to see the chances of you being accepted before you apply) which is a Mastercard (so much more widely accepted than Amex) that offers 0.5% cashback. As above, set up a direct debit for the full amount when you apply for the card.

    How you then choose to use the credit card is up to you. You should make at least one purchase a month on the card but you can also make all your purchases on the card (especially if you go for a cashback card) but if you do this, then make sure you keep back enough money to pay the balance in full at the end of the month. I use the second approach, and have a savings account attached to my joint account for this purpose - each time I buy something on my credit card, I move that amount of money from my current account into the savings account. When my statement comes out, I set up a payment for the working day before it is due (so a Friday, if the direct debit will be collected on the Monday) to transfer the direct debit amount into my current account where it is then collected on the next working day.

    It is important, however, to pay off the card using a direct debit (or a manual payment just before the due date). If you manually pay off the card throughout the month then it is quite possible that the balance reported to the credit reference agencies will be zero, which won't help your credit history as it'll look like you have a credit card that you never use!
    MFW2021 challenge #99: £1,722.83 / £4,200
    MFiT-T5 (Jan 2019 - Jan 2022) challenge #99: £23,424.21 / £30,000
    Initial MF date (18th Dec 2018): Jan 2054 Current MF date: Jul 2050
    Last updated: 26/04/2021
  • SesleaSeslea Forumite
    15 Posts
    First Anniversary
    Thank you!

    I did the eligibility checker for cashback cards and the Tandem one didnt even show up so now thinking maybe I wouldnt get it at all? The ones with the most chance were the Amex. Maybe I'll just got for the one with my bank as I'll only be doing the grocery shopping on it anyway; I'm really trying hard not to spend and save as much as possible!

    The one with my bank says 56 days to pay it off so I'm assuming that if I set the direct Debit theyll take it off ones the month's bill is finalised and not charge me interest?
  • Scotland2021Scotland2021 Forumite
    995 Posts
    Sixth Anniversary 500 Posts Name Dropper
    If you do apply for Amex, I'd try the eligibility checker on their own site.

    Strangely, MSE checker seems to think I've got 95% chance of getting all the Amex's (with adverse on file, I doubt that...). Amex website unsurprisingly says no.

    All eligibility checks are obviously just a guide, but for them to say 95% for me something is seriously wrong with that one (it's only started happening the last month or 2).

    If you're buying a home soon a 0% probably isn't a massive use - as you'll likely either want to pay it off a few months prior to application (improve your acceptance chances (lower debt etc)) or mark it to be repaid before completion (meaning you won't get the full 20+ months benefit anyway).

    Sounds like cashback is best suited to you but setup the DD for full payment as advised above.

    I'd say Amex for sure first pick if their site also shows you as eligible.

    I've heard bad things about Tandem, so I'd personally opt for Aqua Reward instead - easy to get and still 0.5% cashback with a larger more established company.

    If you spend in Asda, the Asda Cashback/Cashback Start cards could also be considered (1% Asda, 0.2% elsewhere)

    If you setup your direct debit to repay in full every month and don't use the card for cash withdrawals/gambling/travel money etc, then you'd never pay any interest.
    Used to work in Underwriting. Only the lender can give a definitive answer to queries
  • SesleaSeslea Forumite
    15 Posts
    First Anniversary
    This is probably a really stupid question but the card with my bank offers 0% interest for 17 months. Im planning on paying off in full each month anyway but if I got that card would that still help build help good credit?
  • [Deleted User][Deleted User] Forumite
    0 Posts
    MoneySaving Newbie
    If you’re paying it off in full then it shows a good credit history.

    If you choose to take advantage of the 0% promo then it will be marked as such on your credit files to lenders and will still maintain a good history for you
  • gt94sss2gt94sss2 Forumite
    4.8K Posts
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    Seslea wrote: »
    My phone is PAYG, I dont use my overdraft, have around 5k credit with a store card/mail order that I pay off immediately after any purchases and a purchase loan that I pay monthly.

    Re: building up your credit record.

    1. Your repaying the purchase loan monthly will help with this.

    2. With any credit card or your existing store card/mail order you should pay them off after the statement has been produced - not immediately after a purchase - if you want it to be properly reflected on your credit record.
  • edited 1 July 2019 at 6:19AM
    SesleaSeslea Forumite
    15 Posts
    First Anniversary
    edited 1 July 2019 at 6:19AM
    Thank you!

    Didn't even think of that with the mail order stuff! I was paying off immediately to make sure it's done and out the way. Also I believed the interest was added on at the time of the statement being produced. I'll have to check into that. A little bit angry at myself because there are months of purchases that's I've missed out of but you live and learn right!

    Also, with the finance thing I was going to pay it off early but I'm guessing it's better to keep that going monthly aswell?
  • gt94sss2gt94sss2 Forumite
    4.8K Posts
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    If paying off the finance early will save you money, then you may as well pay it off. It will be recorded as you having paid it - which in its own way is good as it shows you borrowed money and paid it off.

    With any credit card/store card - one option is to set up a direct debit so the firm takes the balance due in full each month from your bank account - so you don't need to worry about doing it yourself.
This discussion has been closed.
Latest MSE News and Guides

A guide to council tax bands

Lower your band & save £1,000s

MSE Guides

Cinema MoneySaving tips & tricks

Including year's 2for1 movies for £1

MSE Deals