Score advice

Glasnost

Hi all,

First time user here so I hope I’ve posted this correctly.

I am looking to improve my credit score so I’m in a position to get a mortgage. I’m currently making payments to clear my credit cards and store cards. Should I close them off after or leave them open to improve my credit utilisation? I really wanted to close everything off to prevent the temptation to re spend but if this is going to cause me more harm then I’ll leave open.

according to my credit report my utilisation and low credit limit are the only bad factors (also that I’m not on electoral roll, which I am as I voted in December and also checked with council).

Thanks in advance, hope everyone is safe and well.

[Deleted User]

Always ignore the score as it's neither a good indicator nor a factor in lending.

To build a good history, you should have a number of available lines of credit. Use them, but clear in full each month and never pay interest.

However, if you have a spending problem, you would be better to close them and go for a higher rate mortgage from a higher risk provider whenthe time comes, rather than get into a financial mess now.

Glasnost

Thanks for your advice.

I am a little concerned that by keeping the cards open I’m more likely to waste it on stuff I don’t need so may be better closing them. Is it only credit cards that affect utilisation and credit limit? I have 2 store accounts and they don’t seemed to be referenced on this section within my report. 

Additionally, if I have credit cards open with a 0 balance but never use them , is this bad? Should I at least buy something for say £10 and pay off every month.

thanks again

[Deleted User]

You should be using the cards and clearing in full each month.

If you can't control your spending, then close the accounts and take the hit on future borrowing costs. 

But if you get it under control, you'd be much better off using them responsibly to show you can handle credit.

Glasnost

Really appreciate it - I think I’ll go with using the cards and paying off. Does it matter how much it is? Would £10 on petrol each month be ok? 

[Deleted User]

That will be fine. Wait for the statement then clear in full.