loqbox - will it help my credit file after IVA

kewns

Hello,

My IVA is finishing in September after 6.8 years. All my defaults are off my credit file, and the only items currently showing are the IVA and a water bill. I run a business and will soon need access to finance. I recently tried to get a starter credit card but was declined. I do use Clearpay, which is great for my situation, but it doesn't appear on my credit file.

I'm considering signing up for Loqbox or Bits to help improve my credit score. Although I'm not in a rush, I plan to apply for a government business startup loan. My questions are:

1. Does my credit revert to zero once the IVA is officially removed?
2. Will using services like Loqbox or Bits help improve my credit file?

I'm not concerned about the cost as I can easily manage it—I already save £177 per week. Eventually, I would like to obtain a mortgage, and am currently using the Lifetime ISA for that purpose.

Kind regards,

Ste

Grumpelstiltskin

If you haven't got a mortgage now why did you choose to enter an IVA?

I don't know how much you owed but a DMP could have been your best choice.

I think you will have problems getting credit at a reasonable interest rate.

sourcrates

Once the IVA is removed from your file, you then need to re-establish a track record of on time repayments, your water bill, utility bills, all count.

Ignore the score, its solid credit history that`s important, I wouldn`t recommend borrowing just to make further borrowing easier, but you get the gist.

kewns

Grumpelstiltskin said:

If you haven't got a mortgage now why did you choose to enter an IVA?

I don't know how much you owed but a DMP could have been your best choice.

I think you will have problems getting credit at a reasonable interest rate.

Hello,

Thank you for your reply. It wasn't my decision; my ex-partner didn't like the debts, and it stressed her out, so she ended up being convinced to enter an IVA. To be honest, I would have preferred a DMP. I expect to be on a high rate for possibly the first year, but with a regular payment history, it should improve eventually. 

kewns

sourcrates said:

Once the IVA is removed from your file, you then need to re-establish a track record of on time repayments, your water bill, utility bills, all count.

Ignore the score, its solid credit history that`s important, I wouldn`t recommend borrowing just to make further borrowing easier, but you get the gist.

  Hello,

Thanks for your reply. I expected that, and I understand the initial credit card options will be limited. While I don't necessarily need credit, having it could help me grow my business faster.

I'm also considering whether it might be better to switch to an LTD company to build up the company's credit rating instead. What are your thoughts on this? Would you advise against using Loqbox?

Kind regards,

sourcrates

You might be better off asking that on the credit file and ratings board, I`m not that familiar with its use or benefits.

We mainly deal with getting out of debt on this board, what happens next is dealt with elsewhere.

cymruchris

Loqbox - Yes

Bits - No

With the first - you save monthly over 12 months - and at the end you get all your money back into a new TSB current account. You then get a fully 'settled' personal loan on your history. This is beneficial in your case. Don't under any circumstances miss a payment.

With the second - they charge fees you never see again. Don't bother.

kewns

cymruchris said:

Loqbox - Yes

Bits - No

With the first - you save monthly over 12 months - and at the end you get all your money back into a new TSB current account. You then get a fully 'settled' personal loan on your history. This is beneficial in your case. Don't under any circumstances miss a payment.

With the second - they charge fees you never see again. Don't bother.

Thank you, that's what I was thinking as well. I'll just pay the minimum for the year and see what happens. Does the size of the loan—whether it's small or large—have any impact?

Kind regards,

cymruchris

kewns said:

cymruchris said:

Loqbox - Yes

Bits - No

With the first - you save monthly over 12 months - and at the end you get all your money back into a new TSB current account. You then get a fully 'settled' personal loan on your history. This is beneficial in your case. Don't under any circumstances miss a payment.

With the second - they charge fees you never see again. Don't bother.

Thank you, that's what I was thinking as well. I'll just pay the minimum for the year and see what happens. Does the size of the loan—whether it's small or large—have any impact?

Kind regards,

I can't say for sure - but I saved the max per month for the 12 months - and it had a positive impact on my history. I would think that the size of the 'loan' might have a small impact, but whatever happens, you'll have one 'settled' account in your name that will help with positive credit history.