Can’t improve credit rating post DRO

[Deleted User]

Cate1976 said:

The reason I care about my credit rating is that I believe that the situation I’m in means I can’t get credit from anyone which means I can’t show that I can now manage a small amount of credit.  I’ve asked on here as I know people will be able to advise me on what types of credit are likely to be approved.  From the replies so far, it appears that a credit builder card might be the best option.  

Does Cashplus still have the advance thing that allows you to borrow a small amount of money which then gets paid back?  I’m not talking about the credit builder thing they do which means the £5.95 a month fee gets reports to CRA’s.

Current situation isn’t helped by Scottish Power owing us money for the amount we were in credit on the electric when we moved (technical errors appeared on our account in 2020 which meant we couldn’t have duel fuel).   4th April, they said 14 working days, I budgeted for that allowing for bank holidays over Easter.  Cheque didn’t come, so 27th April got on the webchat thing, helpful person said that system won’t allow refund to be issued.  Not getting the refund when I budgeted for it has messed up our finances.  Budget for month from next payment of UC will be done on that alone.

Sorry to have to be the one that takes the low blow... But do you think having credit in your current position is a good idea? You're on a fixed government income (allowance and PIP), so just one month missed clearing the balance(S) of any new credit products in full would potentially be a first class ticket back into the position you were in that required your DRO...

Cate1976

Thanks thanks to everyone who’s taken the time to reply.  The advice in some is really helpful.  I can understand why some of you are suggesting that I don’t get a credit card even with a low limit at the moment.  Since posting, I’ve been thinking that the rent item option isn’t cost effective so will try to save the money for that myself.

This means that I’m likely to try the credit builder with Cashplus and the free version of rent exchange first.  I’m considering trying the sim only mobile contract late August when my credit file will show 6 months at current address.  If I do try to get a credit card with low limit, it won’t be for a few more months.

The only remaining question I have which isn’t obvious on my credit file is whether utilities report on time payments to CRA’s.  I know this is one thing which could improve my credit worthiness and therefore increase the likelihood of me being able to get a small amount of credit.  I’ve learnt from the mistakes I’ve made in the past which is why I’m only looking for a small amount of credit.  The only hard search on my credit file in the last few months is Octopus, who have given me a pay monthly by DD tariff, I was both surprised and pleased about this as I was expecting them to say either deposit for DD or pre pay only.

Regarding the money owed by Scottish Power, I’m doing my budget for the next month based on what I know is coming in and won’t be including the £230 they owe me.  I’m doing a formal complaint to them tonight in the hope that triggers the payment.  

ToxtethO'Grady

Hi there,

You can also look into support your local council can give through a couple of different schemes, Local Welfare Assistance Schemes and the Household Support Fund, your energy supplier and your water supplier will usually have trusts funds that can help with buying white goods if you have an emergency and there maybe trust funds local to you. Turn2Us are good for this with their grant search tool.

Your defaults, any CCJ's and any missed payments are the issue on your credit file so it's making sure you build up your timeline of regular payments. Energy and water companies report payments to CRA's and missing payments to these or your rent have a bigger impact as they are classed as priorities. Credit debts are at the back of the queue, they know this, it's why they shout the loudest, so they know any action taken by the priority debts puts them even further behind your arrears.

My advice would be to look into the help above, especially as your partner is considered vulnerable due to their disability. You can also see if you can get a social tariff for your broadband as well as changing your mobile.

Hope this helps.