Overdraft impact on credit score

crazyfrog90

I have a very low credit score and I've been working hard for the last couple of years to increase it. I have just been accepted for an overdraft with my bank for £1,000. I was quite surprised I was accepted to be honest. I just want to know how this affects my score. Would it be best for me to never dip into it or would it look better if I used small amounts and paid them back quickly? Ultimately, I want to get a credit card so I can build my score with that but I'm not accepted for any at the moment so can this overdraft help with my credit score at all? Many thanks.

[Deleted User]

Your credit score doesn't matter at all.  It's just a gimmick for your entertainment, it doesn't actually have any meaning.

Keep your overdraft but stay out of it.

Try for a sub prime card, but look at your three files first to see what the problem is.

crazyfrog90

I know what the problem is. I ran up a load of debt many years ago and never paid it back. I've only started paying it all back about 3 years ago. So I have defaults on my file plus 1 CCJ that is due to run out July 2021 (6 years elapsed). But for the last 3 years, I haven't missed a payment on anything and my score just isn't moving very much. I've  even taken out a loqbox account but that didn't help much either and my final payment for that is next month.

[Deleted User]

Loqbox never helps very much.

I've already explained that your score doesn't reflect anything so why are you concerned it's not moving?

You need to clear your debts, manage any available credit well and let time do the rest.  If your score gets to zero, that's fine too.

crazyfrog90

 I don't understand why my score doesn't matter though? Can you explain? I assume it's because a potential lender would look at my history rather than the number? If this is the case, then why do we have a score at all? 

Malkytheheed

Sigh....
Zx81 I know how much you love telling people their score doesn't matter. And I know exactly what you mean, but trust me for the general public it's not helpful! As above! 

Please understand that the majority of people say "credit score" as an umbrella term for everything credit history related.

If you just say to people "your credit score doesn't matter at all". And leave it at that. You will really confuse people. I'm sorry but it is as good as misinformation. You need to explain to people that the information on their file IS important but the number generated is not. 

OP. 
The number of your credit score is not worth worrying about as it changes with the wind. 
Your credit file and worthiness IS worth worrying about. I'm a nutshell don't use your overdraft, it will hurt your credit file. 

Dandytf

Overdrafts don't necessarily 'Hurt' Your Credit File', unless Miss-managed and fall into arrears or get withdrawn etc.
I'm a fan of using Credit Scores to watch for considerable changes, such as Experian score dropping a few hundred points unexpectedly. Which after I checked 'Why' across various cra's Files found that 2019 Voters Roles status wasn't recorded correctly, due to later finding after a phone call or two and e few e-mails to local Registry Officer, the entry was updated.
I believe this being updated and recorded correctly, helped me get past my declined Car finance and accepted a few months later.
My Score was used 'In Addition to Payments History' by myself to:-
1. Identify considerable dropped points - from over 3xx down to 52.
2. Take up incorrect Voters role entry with Checkmyfile, leading to Experian.
3.  Resolve via Local Voters Registry.
Finally allow a few weeks for CRA Files to update correctly. And Visually my score regained from 52 upto 3xx range.
I'm using my score during DMP  years, as a visual benchmark of any improvements being made, much more useful in later years,
I have in the past witnessed my score 'Recover' from low double digits up-to high triple digits, when I unfortunately had one default applied, and cleaned in a few months.

Dandytf

   
Mser's Today's bright Fair progress, has taken me quite a few years.
Nice example of Using Credit Score progress.
Edited.
Didn't capture 735/999 Score.

ManyWays

At the moment you have so many bad things (ccjs, defaults) that any small good things (loqbox) don’t really make a difference. When the ccjs and defaults start to drop off, new good things will be more visible. It’s like having a garden chocked by weeds, you plant something new and nice but all people can see are the weeds. Using your overdraft will incur fees but it won’t improve your credit score. 

D3xt3r5L4b

Malkytheheed said:

Sigh....
Zx81 I know how much you love telling people their score doesn't matter. And I know exactly what you mean, but trust me for the general public it's not helpful! As above! 

Please understand that the majority of people say "credit score" as an umbrella term for everything credit history related.

If you just say to people "your credit score doesn't matter at all". And leave it at that. You will really confuse people. I'm sorry but it is as good as misinformation. You need to explain to people that the information on their file IS important but the number generated is not. 

OP. 
The number of your credit score is not worth worrying about as it changes with the wind. 
Your credit file and worthiness IS worth worrying about. I'm a nutshell don't use your overdraft, it will hurt your credit file. 

No - people say “score” as in the number, because that’s what the talking dog, Anthea Turner and the hipster who swipes his car to a better one in-line with his score increasing tells us to look at and believe as a measure of credit worthiness. 

Loqbox and the like also advertise their products as “score improvement” products and it’s totally misleading and I’m surprised that Trading Standards haven’t been informed of such false advertising. 

I see people come on here bleating about their immaculate and “high” scores yet can’t get simple credit like a phone contract or even a sub-prime credit card.

When people say “score” they mean the “score” otherwise they wouldn’t say it. 

sourcrates

We have a sticky thread that explains what your credit score really means, at the top of this forum.

Many regulars have posted, many times in responce to credit score questions, that its simply a tool used in marketing, most CRA`s are credit brokers, most even tell you in their FAQ`s no one see`s that score but you, yet the hits keep on coming........