building a credit rating

98jdougl

Hi,
I have a terrible credit rating due, in the main part to an ex-partner taking out things in my name (without me knowing) and not paying them.
I am not trying to justify the bad record in anyway- it's there and it's going to stay there.

What I want to know is if there is anything I can do to improve it.

Have sent away for my credit report but they are unable to verify my identity.

I am 21 and live with my father and am in full time employment earning 5* more than I did a couple of years ago when everyone was throwing offers of credit at me.

I have recently opened a credit account of #249 (sorry, pound sign doesn't work) with Next and am planning on buying a couple of things every month (like usual), put it on my account and pay it off straightaway.

Would this help make a difference?
Does anyone have any suggestions as to other ways to improve my score?

geordie_joe

What credit do you want? If you are now earning 5* what you were, you shouldn't need credit. Apart from a mortgage you shouldn't need to borrow any money, so don't worry about your credit rating. As for Next, why do that, why not just wait until you get paid and pay for the two things with cash. Once you start using cards you always end up buying more than you can afford to pay back in one go. Once that happens you have a credit bill, and that's one step away from being in debt. Also try saving as much money as you can in the bank. Banks love to lend money to people who save regularly, it shows they can make the repayments.

carpetbelly

MailOrder isn't something that's highly regarded unless you miss payments.

Make sure you get your credit file. See what's on there first. Go to the people who've put marks against it and make sure things are paid off.

See if you can maybe get a capital one or vanquis BUT this has to be paid off each time you use it. If you do not think you can discipline yourself to do this, I wouldnt bother at the interest rates the high risk cards can do.

Personally, give it time. Tbh, unless you're desperate for credit at the moment which in todays market I wouldnt bother chasing around just yet, I'd wait it out. And when you do get some, just ensure you make payments on time and the minimum amount (at the least!).

98jdougl

re: geordie,
Having a good enough credit rating for a good mortage rate is something that I am concerned about.
I currently live with family but don't exactly want hat to be permanent and to rent/get a mortgage I will need to increase my credit rating.

I prefer using my next account rather than cash because I can keep track of what I've spent there.

I only ever spend what I can afford, well I could afford to use the whole limit every month if I so chose, but I don't. I then pay it off in full each month.

I want to be able to get credit for emergencies, ie: my sister got herself into some trouble before and luckily my father had a credit card that he could use to wire her money and get herplane ticket etc.

I also find it a struggle to pay cash because I work over 75 hours per week and therefore struggle to find the time to go round shops.

Any advice on what I can do to build my rating? I opened a savers account a fortnight ago where I put 5% of my monthly wage into it.

carpetbelly

Banks love savers but savings accounts do not show on credit files as they're not credit products. Mail order is quite often ignored on credit files (when applying for other credit) unless it's in default. Same with mobile phones.

But at the end of the day, renting/getting a mortgage should be fine if your credit file is clean, allbeit empty. You'd just have to prove your earnings.

CLAPTON

first essential step is to get copies of all three of your credit records and see whats on them... why can't they confirm your identity..are you on the electoral roll?

98jdougl

yes I am on the electoral roll, I don't know why they couldn't verify my identity.

also carpetbelly, i do not have a clean history- please see the first line of my oopening statement- i have a terrible credit history report

geordie_joe

98jdougl wrote: »

i have a terrible credit history report

This might be a silly question, but how do you you have a "terrible credit history report"? You haven't seen it yet.

98jdougl

well, last year I had a terrible one and assuming it is much the same.
Also did the generic online one where I had a one star rating

Alex_of_Swansea

If it helps, I've now lived in three rented houses (two student and one married) and no credit check as yet! Landlords tend to get referees from previous landlords, but this hasn't happened either. What will help, if you do want to rent and they don't accept your bank account records, is to have your parents as guarantors. It's just someone else the landlord can get money from should you default. So you'll be fine!
I wouldn't buy a house yet anyway, so everyone's a winner!
Ax

carpetbelly

Things fall off your file after 6yrs. So if you've paid things off then it won't matter after that period of time. But even after a couple of years you're generally given a bit of a chance with the higher risk credit card companies say.

The best way to build up a credit rating is to get a credit product and ensure you make regular payments and do not over stretch yourself with lots of products and limits.

If an ex partner took these credit items out in your name why are you paying for them? Surely you could prove that any signatures werent yours but then you're talking about fraud and that's something else that you obviously might not want to put someone through.