Take a credit card out or no?

EmzJenks

Hello! Hubby and I are 8 months into a 2 year fixed mortgage with Kensington mortgages. Went with them due to some past credit issues. When we come to re-mortgage in 2023 then our advisor is confident we'll be able to re-mortgage to a better lender with better rates, as long as we keep doing what we're doing, ie paying everything on time. I'm really keen to do what I can to improve my credit report as much as possible. Still showing as poor due to a CCJ not becoming clear of settled date until early next year. I haven't had a credit card in over 15 years, but is it worth taking one out with a small limit and paying it off every month to show I pay it back on time all the time? Or is taking out more credit worse and it'll do more harm than good? Any advice welcomed!

stormpassing

I can’t advise for anyone else but I can tell you about what I did. When I was building my credit score this is exactly what I did. I set up a DD to clear the balance in full every month. I use it for petrol once or twice a month and then it’s paid off in full. It really helped to build my credit score. 

What I would say though is it can be a dangerous game. If you are in any way unsure whether you will be tempted to spend frivolously on it I would steer well clear.
I would also discuss it with your hubby first too.

EmzJenks

stormpassing said:

I can’t advise for anyone else but I can tell you about what I did. When I was building my credit score this is exactly what I did. I set up a DD to clear the balance in full every month. I use it for petrol once or twice a month and then it’s paid off in full. It really helped to build my credit score. 

What I would say though is it can be a dangerous game. If you are in any way unsure whether you will be tempted to spend frivolously on it I would steer well clear.
I would also discuss it with your hubby first too.

That's good to know! And yes plan was to put one of our weekly shops on it a month. And transfer the money from the current account to pay it off. So not spend more than we would usually just a different way of paying it to help build the credit score. 
It's a joint decision but the poor credit is mine so figured it would be better to take it out in my name to build my score up. 
Thanks for sharing your experience

K_S

EmzJenks said:

Hello! Hubby and I are 8 months into a 2 year fixed mortgage with Kensington mortgages. Went with them due to some past credit issues. When we come to re-mortgage in 2023 then our advisor is confident we'll be able to re-mortgage to a better lender with better rates, as long as we keep doing what we're doing, ie paying everything on time. I'm really keen to do what I can to improve my credit report as much as possible. Still showing as poor due to a CCJ not becoming clear of settled date until early next year. I haven't had a credit card in over 15 years, but is it worth taking one out with a small limit and paying it off every month to show I pay it back on time all the time? Or is taking out more credit worse and it'll do more harm than good? Any advice welcomed!

@emzjenks From my experience, not having a credit card on your report has never stopped a client from getting a mortgage. With respect to a mortgage, you can absolutely ignore the Experian/Clearscore/CreditKarma "credit-score" as lenders do not use them. All they care about is what is in your credit report and the cleaner your credit history is, the better.