I’ve got a good credit score, but my credit card and loan affordability is weak, please advise?

Chris_derby

nic_c said:

Chris_derby said:

D3xt3r5L4b said:

What you see for your rating and score is a best guess based on nonsensical algorithms.

How much do you need for the campervan?
Does the seller take credit card as a payment option?

If you have “substantial savings” why not use those?

Thanks for your reply and yes looks like credit scores mean nothing!

I would have like a credit with £10,000, my wife has one for £9,000 and was going to put cash towards it as well. Wanted to flexibility of paying over a longer period, didn’t want to wipe out all of my savings and 0% credit cards do this nicely. When I say substantial, I probably mean just enough to buy the campervan.

So you got an M&S card, was the 0% period for the full time they were offering - if so then it's not your "credit rating" but affordability. You don't say what your annual income is and the disposable element of it. Are you on £30K, £40K pa?

Also different lenders have different affordability criteria - some will give you higher limits than others. Re your wife you don't say who the card is with or whether she got £9K initially or they've increased the limit since. 

If you've applied for the M&S be mindful of when you apply again as it may make you look desperate for money (he's applied for an M&S so why does he need another card so soon?).  

I’m on closer to £40k, but have taken a pay drop recently as my shift premium has been reduced due to working a new pattern. Could this have an affect taking a pay drop?

My wife’s card is with Sainsburys, she was going to close it as the interest free period expired but they offered her an additional 21 months interest free when she was closing. She’s always had a limit of £9000, filled it and cleared it as required.

Totally understand about applying again elsewhere and doing it too soon after the M&S card. It was over a week ago now and I’ve not applied elsewhere yet for this reason. I need to pay for my Campervan in 5-6 weeks time so could do with the credit by then ideally.

maisie_cat

It is bizarre, I used the MSE credit thingy the other day and my debt level is deemed risky. I have no long term debt or any loans, all I have is a credit card I use for spending that I pay off every single month and have done since I acquired the card in 1998.

D3xt3r5L4b

Why was the £12k card closed?
You haven’t mentioned salary and any other debts/outgoings.

Chris_derby

D3xt3r5L4b said:

Why was the £12k card closed?
You haven’t mentioned salary and any other debts/outgoings.

I cancelled my Sainsburys card as I paid off the £12000 I spent within the interest free period, the period has now expired. I normally just close the card after the interest free period has ended has I wouldn’t really use it again, I think it keeps things tidy. Am I doing this correctly, or should I just keep the cards open if I’m not going to use them again.

Salary is around £40k, this has dropped during the pandemic as my shift premium has reduced as I’m working different shifts now. This could also have a negative effect?

I don’t really have any other debts now other than my mortgage. This and another credit card with £700 left to pay on it, with a £9000 limit.

Chris_derby

maisie_cat said:

It is bizarre, I used the MSE credit thingy the other day and my debt level is deemed risky. I have no long term debt or any loans, all I have is a credit card I use for spending that I pay off every single month and have done since I acquired the card in 1998.

I know what you mean, I’ve never not made a payment on time and always pay off at least the minimum every month. I don’t understand why my affordability is now weak. The only thing that’s changed since it was good is taking out the £2000 M&S card.

MaryNB

 I cancelled my Sainsburys card as I paid off the £12000 I spent within the interest free period, the period has now expired. I normally just close the card after the interest free period has ended has I wouldn’t really use it again, I think it keeps things tidy. Am I doing this correctly, or should I just keep the cards open if I’m not going to use them again.

Having long term accounts is good. One of the comments on my credit file is that the average age of my accounts is less than six years which doesn't show great stability (I've only been in the UK 6 years so can't really help that). The longer the average age of your accounts the better. Opening and closing accounts frequently isn't great. Also puts more hard searches on your account. A hard search here and there isn't an issue. We all need to apply for credit at some point but too many doesn't look good. 

Chris_derby

MaryNB said:

 I cancelled my Sainsburys card as I paid off the £12000 I spent within the interest free period, the period has now expired. I normally just close the card after the interest free period has ended has I wouldn’t really use it again, I think it keeps things tidy. Am I doing this correctly, or should I just keep the cards open if I’m not going to use them again.

Having long term accounts is good. One of the comments on my credit file is that the average age of my accounts is less than six years which doesn't show great stability (I've only been in the UK 6 years so can't really help that). The longer the average age of your accounts the better. Opening and closing accounts frequently isn't great. Also puts more hard searches on your account. A hard search here and there isn't an issue. We all need to apply for credit at some point but too many doesn't look good. 

Noted, I’ll definitely keep the credit card accounts open in future if that’s the case or at least wait a while before closing.

theoretica

Chris_derby said:

D3xt3r5L4b said:

Chris_derby said:

D3xt3r5L4b said:

What you see for your rating and score is a best guess based on nonsensical algorithms.

How much do you need for the campervan?
Does the seller take credit card as a payment option?

If you have “substantial savings” why not use those?

Thanks for your reply and yes looks like credit scores mean nothing!

I would have like a credit with £10,000, my wife has one for £9,000 and was going to put cash towards it as well. Wanted to flexibility of paying over a longer period, didn’t want to wipe out all of my savings and 0% credit cards do this nicely. When I say substantial, I probably mean just enough to buy the campervan.

MBNA give you an idea on what you're limit could be when applying, as do Halifax, Lloyds and Nationwide.
Whilst £10k credit isn't unheard of, given the current climate as well, what are you current debts/income/limits on existing cards etc.?

I’ve currently got a £9000, £5000 credit cards open, the £9000 has got about £700 to pay and the £5000 is cleared.

So if you took advantage of all the credit available to you at the moment you would get into 9+5+2 = £16k debt?  That is a figure the banks will be considering when deciding whether to lend you another £10k.

Chris_derby

theoretica said:

Chris_derby said:

D3xt3r5L4b said:

Chris_derby said:

D3xt3r5L4b said:

What you see for your rating and score is a best guess based on nonsensical algorithms.

How much do you need for the campervan?
Does the seller take credit card as a payment option?

If you have “substantial savings” why not use those?

Thanks for your reply and yes looks like credit scores mean nothing!

I would have like a credit with £10,000, my wife has one for £9,000 and was going to put cash towards it as well. Wanted to flexibility of paying over a longer period, didn’t want to wipe out all of my savings and 0% credit cards do this nicely. When I say substantial, I probably mean just enough to buy the campervan.

MBNA give you an idea on what you're limit could be when applying, as do Halifax, Lloyds and Nationwide.
Whilst £10k credit isn't unheard of, given the current climate as well, what are you current debts/income/limits on existing cards etc.?

I’ve currently got a £9000, £5000 credit cards open, the £9000 has got about £700 to pay and the £5000 is cleared.

So if you took advantage of all the credit available to you at the moment you would get into 9+5+2 = £16k debt?  That is a figure the banks will be considering when deciding whether to lend you another £10k.

So would you say your better off cancelling a credit card once the interest free period has expired to bring the amount down for future applications?

theoretica

Chris_derby said:

theoretica said:

Chris_derby said:

D3xt3r5L4b said:

Chris_derby said:

D3xt3r5L4b said:

What you see for your rating and score is a best guess based on nonsensical algorithms.

How much do you need for the campervan?
Does the seller take credit card as a payment option?

If you have “substantial savings” why not use those?

Thanks for your reply and yes looks like credit scores mean nothing!

I would have like a credit with £10,000, my wife has one for £9,000 and was going to put cash towards it as well. Wanted to flexibility of paying over a longer period, didn’t want to wipe out all of my savings and 0% credit cards do this nicely. When I say substantial, I probably mean just enough to buy the campervan.

MBNA give you an idea on what you're limit could be when applying, as do Halifax, Lloyds and Nationwide.
Whilst £10k credit isn't unheard of, given the current climate as well, what are you current debts/income/limits on existing cards etc.?

I’ve currently got a £9000, £5000 credit cards open, the £9000 has got about £700 to pay and the £5000 is cleared.

So if you took advantage of all the credit available to you at the moment you would get into 9+5+2 = £16k debt?  That is a figure the banks will be considering when deciding whether to lend you another £10k.

So would you say your better off cancelling a credit card once the interest free period has expired to bring the amount down for future applications?

It will be a balancing act between showing stability and long accounts and having potential credit you don't intend to use.  Reducing credit limits is also a thing to consider.