Credit card for mortgage

RBilbee

I am 28 and start studying my 4 year degree this year. I live with my partner who works full time, and has just started progressing his chosen career. We have a 2 year old and another one on the way. We currently live in a private rental property, that we know we will quickly grow out of. Neither of us have had a credit card before. However, we understand that if we would like to expand our family we will need to find a bigger place, and we would like to get a mortgage out when I am qualifed. My question is, should we get a credit card soon to build up our credit rating to be able to get out a mortgage in 5 years time (when we both will be working)? Would I be eligible as a non employed student to get a credit card, or would I need to be employed? 

[Deleted User]

You may be able to get a sub prime card or one with your own bank.

Make sure you understand how to use it if you get one.

jbrassy

Do some eligibility checks on some credit builder cards such as Capital One, Aqua, etc. If you pay the credit card off in full every month, it will be beneficial towards your credit rating. A more comprehensive list of cards you could apply for are here:
https://www.moneysavingexpert.com/credit-cards/bad-credit-credit-cards/

Ebe_Scrooge

That's good advice from ZX81.  Your partner may have a better chance of getting a card, but there's no harm in applying - your own bank is often a good starting point if you have very little credit history so far.  But don't go applying for loads in close succession - more than a couple of applications close together makes you look desperate, and will reflect negatively on your credit file.

In terms of using the card - as per the above, make sure you understand how to use it.

1.  Use it for everyday spending, things you would buy anyway - food, petrol, etc.

2.  Only ever use it things you can afford, don't be tempted to see it as "free money".

3.  Always, always, ALWAYS, pay the statement in full and on time.  Don't pay the balance off before the statement arrives, otherwise you lose the benefit of building up a repayment history (it would show on your credit files as not being used).  You'll typically have something like 2 weeks between the statement arriving and the "Payment Due" date.  Make sure you pay the FULL balance, after the statement arrives but before the "payment due" date.  The simplest way is to set up a Direct Debit.  You'll have the option of setting the DD to pay Minimum Payment, a fixed amount, or Full Statement Balance - make sure you pick the 3rd option.

4.  When setting up the DD, pay close attention to your first statement.  If the DD has been set up in time, the statement will say "Balance due to be collected by Direct Debit on <date>".  If you don't see the DD mentioned, make sure you pay manually for the first time, then check the next statement to make sure the DD is now in place.

5.  Don't worry about the APR - if you always pay in full, you won't pay any interest.

Oh, and well done for referring to your credit "rating" rather than "score".  The score is - you're probably aware - completely meaningless.  It's the contents of your credit history that a prospective lender will look at.  There's nothing magical about it, ultimately they're looking for evidence of someone who manages credit responsibly, borrows what they can afford and meets their repayment obligations consistently and on time.  Good luck with the future mortgage and growing family :-)