Current account opening impact on credit profile

zpargo

Hi 
How much does this matter. I opened a current account in Feb and April for switching and LOQ box. And what to do credit application now.
How long does this take to clear and how much impact will this make?
Only reason I opened current account was because I was forced to by LOQBox

NewLeaf1986

If you immediately close the account you had to open for Loqbox it will have less of an impact.

As a rule of thumb, having any accounts newer than six months old can have a slightly detrimental effect on your creditworthiness. This effect can be sidestepped by closing the new account. It can take up to six weeks for the account closure to reflect on your credit files. 

Ebe_Scrooge

Do you have an overdraft facility on the current account ?  If you do, it'll have more of an impact on your credit file than if not - but either way, the effect of a current account is going to be very small and will make almost no material difference to your ability to obtain credit.

NewLeaf1986

I think it's the acquisition of two new accounts in a very short timeframe that could be an issue..
One account, I'd agree but two is starting to reach into territory that could give a lender rise to concern.

zpargo

Ebe_Scrooge said:

Do you have an overdraft facility on the current account ?  If you do, it'll have more of an impact on your credit file than if not - but either way, the effect of a current account is going to be very small and will make almost no material difference to your ability to obtain credit.

This is the thing - I have over draft facility on my HSBC account. But I haven't used it. Never realised the pitfalls of switching around time of credit application.

zpargo

NewLeaf1986 said:

I think it's the acquisition of two new accounts in a very short timeframe that could be an issue..
One account, I'd agree but two is starting to reach into territory that could give a lender rise to concern.

I may have to get LOQ box to send an e-mail to lender to explain that current account opening was due to them. Only consolation is that LOQ will they say increase points on credit score. But this could be like 1 point but I lose 10 for current account opening.

[Deleted User]

zpargo said:

NewLeaf1986 said:

I think it's the acquisition of two new accounts in a very short timeframe that could be an issue..
One account, I'd agree but two is starting to reach into territory that could give a lender rise to concern.

I may have to get LOQ box to send an e-mail to lender to explain that current account opening was due to them. Only consolation is that LOQ will they say increase points on credit score. But this could be like 1 point but I lose 10 for current account opening.

It doesn't matter if you gain 1 and lose 500.

Lenders will just see the new current account. It's very unlikely to cause them any concern.

sparklep0ny

NewLeaf1986 said:

If you immediately close the account you had to open for Loqbox it will have less of an impact.

As a rule of thumb, having any accounts newer than six months old can have a slightly detrimental effect on your creditworthiness. This effect can be sidestepped by closing the new account. It can take up to six weeks for the account closure to reflect on your credit files. 

No, it won't.

Closing the current account now won't make the blindest bit of difference.  In fact, it could arguably make things worse (Why was the new account shut down in such a short period of time?  Did the bank get spooked by something and close their account down?)

The OP can close it if they don't want it but it certainly won't help matters by doing so.

NewLeaf1986

sparklep0ny said:

NewLeaf1986 said:

If you immediately close the account you had to open for Loqbox it will have less of an impact.

As a rule of thumb, having any accounts newer than six months old can have a slightly detrimental effect on your creditworthiness. This effect can be sidestepped by closing the new account. It can take up to six weeks for the account closure to reflect on your credit files. 

No, it won't.

Closing the current account now won't make the blindest bit of difference.  In fact, it could arguably make things worse (Why was the new account shut down in such a short period of time?  Did the bank get spooked by something and close their account down?)

The OP can close it if they don't want it but it certainly won't help matters by doing so.

Well, that was my opinion based from experience and this is your opinion based from experience.

That's all anyone here can do, guess based on anecdotal evidence. None of us are privvy to lenders' internal credit scoring models so we all just throw some conjecture and opinion into the hat for others to take or leave as they please. 

phillw

NewLeaf1986 said:
None of us are privvy to lenders' internal credit scoring models so we all just throw some conjecture and opinion into the hat for others to take or leave as they please. 

Kinda like a credit score. Opening a current account is a normal thing to do, so I doubt the entire market would penalize you for it. But one lender might and they might be your chosen one.

Which leads you the paranoia of not doing anything if you're about to apply for a mortgage, otherwise knock yourself out.

cymruchris

NewLeaf1986 said:

sparklep0ny said:

NewLeaf1986 said:

If you immediately close the account you had to open for Loqbox it will have less of an impact.

As a rule of thumb, having any accounts newer than six months old can have a slightly detrimental effect on your creditworthiness. This effect can be sidestepped by closing the new account. It can take up to six weeks for the account closure to reflect on your credit files. 

No, it won't.

Closing the current account now won't make the blindest bit of difference.  In fact, it could arguably make things worse (Why was the new account shut down in such a short period of time?  Did the bank get spooked by something and close their account down?)

The OP can close it if they don't want it but it certainly won't help matters by doing so.

Well, that was my opinion based from experience and this is your opinion based from experience.

That's all anyone here can do, guess based on anecdotal evidence. None of us are privvy to lenders' internal credit scoring models so we all just throw some conjecture and opinion into the hat for others to take or leave as they please. 

My opinion is also not to close an account you've just opened. It shouts 'something went wrong'. Better to keep an account open over a long period to ensure an increase in stability. (and in the case of Loqbox - after 12 months you'd have a fully satisfied loan account which helps with your positive history)