Multiple credit cards to help rebuild - Good idea or not going to make much difference?

gd55

Hello! Let me start by saying thank you to all those who post their questions and advice on these forums. I've been lurking for a few weeks and have learnt so much just by reading.

I have recently completed my IVA (entered in September 2017 and settled in November 2021 - mum was able to pay the final chunk in a full and final offer). I had just more than £17k debt and I'm beyond proud of myself for getting it sorted and settled over the past few years. What a weight off!

Anyway, I'm now rebuilding and thinking ahead to a more financially secure and sensible future.

I've been checking my credit file on Equifax and everything looks in order. The IVA has been marked as settled and I believe the accounts that were part of that, which are all showing as "in default", will drop off around autumn 2023 - six years after they defaulted and I entered the IVA.

I have been able to get a Vanquis Chrome card with a £500 limit. This has been open since January and I've no worries about being able to manage it sensibly. I am spending around £150 on petrol and food and paying off in full each month.

Having checked on ClearScore I am now "pre-approved" for nine other cards - a mixture of Capital One, Post Office, Ocean and Think Money.

Here's my question: Would opening a second card at this stage help or hinder my goal of boosting my credit worthiness and one day getting a mortgage with my boyfriend? (In terms of when we'd want to buy a house, I guess we'd need to wait until the IVA has dropped off, so that'd be late 2023/early 2024.)

It would also be carefully managed - small spends to keep it ticking over and paid off in full each month, and on standby in case of emergencies. I have a good income and confidence in my "adult" approach to money management these days, so am not worried about keeping everything in check.

I'd go for the one with the lowest interest rate which is 28.7%, a little below the Vanquis I have of 29.5%.

Thanks in advance for any advice/examples.

[Deleted User]

It's always sensible to have at least a couple of cards for multiple reasons.

If you can get a second card, use both regularly and clear in full. Don't restrict yourself to 'small spends' unless you're approaching your credit limit, if you gave the discipline to pay in full each month.

The APR shouldn't be a factor in deciding which is card to apply for, unless every other feature is identical, as you won't be paying interest.

gd55

Deleted_User said:

It's always sensible to have at least a couple of cards for multiple reasons.

If you can get a second card, use both regularly and clear in full. Don't restrict yourself to 'small spends' unless you're approaching your credit limit, if you gave the discipline to pay in full each month.

The APR shouldn't be a factor in deciding which is card to apply for, unless every other feature is identical, as you won't be paying interest.

Thank you.

Good point on the APR. An Ocean one does have 0% on purchases for three months, but as I'm not planning any big purchases that I wouldn't pay off in full anyway that's not a deal-breaker, unless there's something I'm missing?

[Deleted User]

No. Just go the card you prefer (eg it there are any benefits) but most importantly one that you have a good chance of getting.

gd55

Deleted_User said:

No. Just go the card you prefer (eg it there are any benefits) but most importantly one that you have a good chance of getting.

Thanks again!

Alex9384

gd55 said:

Deleted_User said:

No. Just go the card you prefer (eg it there are any benefits) but most importantly one that you have a good chance of getting.

Thanks again!

Get one Visa and one MasterCard if possible. It's not super important in your case, but just in case one network has an outage. I would also recommend 2 current accounts with totally different banks (not in the same banking group).

2 or even 3 cards are perfectly OK. After 6 months from account opening you can try if you can increase your credit limit. Even if you don't need it, just try it. £500 is really low. Higher limits will show other lenders that your current lender trusts you enough to offer you more credit and that you can handle it and can be trusted with credit.

Btw, always pay off the card after the statement is produced. Some people pay before they get statement, that's not the best way. Ideally set up direct debits for full amount and let the card providers to take payment from your current account(s).

Dandytf

To add

my post sc dmp experience in applying for a few credit cards in succession has resulted in some decent cards and limits.
If I had to choose again I would not have applied for more than 2 cards in 1st post dmp year.
As I have never quite Managed to return to 'Excellent' Experian rating though high number 'Good' rating.

That was 2021, now I'm reducing unused cards 2022 and bringing spending back in line with rbs my bank.
p.s. these lots of cards haven't hindered car and windows finance and PayPal and Next credit.

I should mention I've never used over 7% of combined limits.

thanks

gd55

Alex9384 said:

gd55 said:

Deleted_User said:

No. Just go the card you prefer (eg it there are any benefits) but most importantly one that you have a good chance of getting.

Thanks again!

Get one Visa and one MasterCard if possible. It's not super important in your case, but just in case one network has an outage. I would also recommend 2 current accounts with totally different banks (not in the same banking group).

2 or even 3 cards are perfectly OK. After 6 months from account opening you can try if you can increase your credit limit. Even if you don't need it, just try it. £500 is really low. Higher limits will show other lenders that your current lender trusts you enough to offer you more credit and that you can handle it and can be trusted with credit.

Btw, always pay off the card after the statement is produced. Some people pay before they get statement, that's not the best way. Ideally set up direct debits for full amount and let the card providers to take payment from your current account(s).

Thank you.

I went ahead and got a second card, it is with Ocean with a £1,500 limit. I now have one Visa and one Mastercard, total limit £2k, and will be paying balances in full each month via Direct Debits. I'll see what they offer in terms of credit increases as I go along and take them to aid the positive marks on my file.