First Credit Card at 31

the_tiramisu_tyrant

Hello,

I am 31 years old and have never had a credit card. In the next 2 or 3 years, I would like to buy a house, so I believe it would be a good idea to get a credit card to build my credit in time for that. My plan is to get a credit card and use it for everyday spending and always pay it off in full. I have always been very responsible with money with no issues whatsoever. I understand the risks of a credit card which is mainly why I've never got one, and also just because I've never needed one at all.

When I go on MSE, it seems to recommend me a credit building card because I have never had a credit card before. However, if I'm eligible for a rewards card or a different card, wouldn't I be better off getting one of those if I will be using for everyday spending and always paying off in full every month? I want to make sure that I get the best card I can that 1) allows me to best build up credit to help in a mortgage application, but also 2) benefits me the most if I'm always paying off in full and using it for everyday spending.

Any guidance is appreciated, as right now I'm still clueless on what type of card is best for me.

Thanks!

vacheron

I would start by using one of the online eligibility calculators (MSE has one on this site), to see if you meet the  eligiblity requirements for one of the mainstream cards without placing a hard search on your credit report. If the odds look good, maybe apply for one or two. A mainstream card will look better on your credit report (and probably have a more usable credit limit) than a "credit builder" card. 

The credit builders will still be there as a fallback option if you are not successful.

Gandalf644

the_tiramisu_tyrant said:

Hello,

I am 31 years old and have never had a credit card. In the next 2 or 3 years, I would like to buy a house, so I believe it would be a good idea to get a credit card to build my credit in time for that. My plan is to get a credit card and use it for everyday spending and always pay it off in full. I have always been very responsible with money with no issues whatsoever. I understand the risks of a credit card which is mainly why I've never got one, and also just because I've never needed one at all.

When I go on MSE, it seems to recommend me a credit building card because I have never had a credit card before. However, if I'm eligible for a rewards card or a different card, wouldn't I be better off getting one of those if I will be using for everyday spending and always paying off in full every month? I want to make sure that I get the best card I can that 1) allows me to best build up credit to help in a mortgage application, but also 2) benefits me the most if I'm always paying off in full and using it for everyday spending.

Any guidance is appreciated, as right now I'm still clueless on what type of card is best for me.

Thanks!

Providing you pay it off in full every month, any credit card, even a credit builder is better than no credit card in building up a credit history. If all you are being offrered is sub-prime cards, it is becauise you have no history!

However, have you tried where you bank? They maybe a bit more receptive as they hold some history of how you have conducted your account. Even better if they offer you some form of rewards card.

Mark_d

How good is your credit report?  You can check credit scores with apps from Experian, credit karma and clearscore.  Although you've never had a credit card, rent payments, utility bill payments, mobile phone bill payments might appear on your credit report and therefore contribute to a good score.
You should also be checking your credit reports for errors.  You don't want to state getting declined for things because of an error on your credit report.

The type of credit card you can get depends on your income/affordability as well as your credit history.  Some website can give you an indication of  cards you'd be eligible for, based on nothing more than a soft credit check. 

Ever since I was 18 I've used a cashback/rewards credit card - repaying in full by direct debit each month.  Because I'm very frugal - I need good reason to spend more than the minimum on anything - I consider myself very safe from spending more than I earn.

Your first goal here is the mortgage.  The £100 you earn from credit card cashback will be insignificant to any savings you make by getting a good mortgage deal.  I would then pick a bank that would give you a reasonable mortgage - and move my current account and credit card to them.  I think First Direct and Nationwide are both good options.  As the bank would have visibility of all your transactions they will be able to help you best when it comes to a mortgage.

daveyjp

If you have a longstanding relationship with your bank start with an application for one of their cards.

Nasqueron

Mark_d said:

How good is your credit report?  You can check credit scores with apps from Experian, credit karma and clearscore.  Although you've never had a credit card, rent payments, utility bill payments, mobile phone bill payments might appear on your credit report and therefore contribute to a good score.
You should also be checking your credit reports for errors.  You don't want to state getting declined for things because of an error on your credit report.

The type of credit card you can get depends on your income/affordability as well as your credit history.  Some website can give you an indication of  cards you'd be eligible for, based on nothing more than a soft credit check. 

Ever since I was 18 I've used a cashback/rewards credit card - repaying in full by direct debit each month.  Because I'm very frugal - I need good reason to spend more than the minimum on anything - I consider myself very safe from spending more than I earn.

Your first goal here is the mortgage.  The £100 you earn from credit card cashback will be insignificant to any savings you make by getting a good mortgage deal.  I would then pick a bank that would give you a reasonable mortgage - and move my current account and credit card to them.  I think First Direct and Nationwide are both good options.  As the bank would have visibility of all your transactions they will be able to help you best when it comes to a mortgage.

Keep in mind your references to credit "scores" should be replaced by credit "history" as the scores you see are not only not used by lenders - they're not even seen by lenders

th081

Genuine question will mortgage company be bothered about use of a credit card and pay back each month. They are more concerned with salary, house value, amount borrowed etc. it's a secured loan at the end of the day.

the_tiramisu_tyrant

vacheron said:

I would start by using one of the online eligibility calculators (MSE has one on this site), to see if you meet the  eligiblity requirements for one of the mainstream cards without placing a hard search on your credit report. If the odds look good, maybe apply for one or two. A mainstream card will look better on your credit report (and probably have a more usable credit limit) than a "credit builder" card. 

The credit builders will still be there as a fallback option if you are not successful.

Hi there. What do you mean by "mainstream" cards? Do you mean just one of the big banks? And also, what is the benefit of applying for one or two rather than just one, if a credit check lowers your credit score right?

the_tiramisu_tyrant

Gandalf644 said:

the_tiramisu_tyrant said:

Hello,

I am 31 years old and have never had a credit card. In the next 2 or 3 years, I would like to buy a house, so I believe it would be a good idea to get a credit card to build my credit in time for that. My plan is to get a credit card and use it for everyday spending and always pay it off in full. I have always been very responsible with money with no issues whatsoever. I understand the risks of a credit card which is mainly why I've never got one, and also just because I've never needed one at all.

When I go on MSE, it seems to recommend me a credit building card because I have never had a credit card before. However, if I'm eligible for a rewards card or a different card, wouldn't I be better off getting one of those if I will be using for everyday spending and always paying off in full every month? I want to make sure that I get the best card I can that 1) allows me to best build up credit to help in a mortgage application, but also 2) benefits me the most if I'm always paying off in full and using it for everyday spending.

Any guidance is appreciated, as right now I'm still clueless on what type of card is best for me.

Thanks!

Providing you pay it off in full every month, any credit card, even a credit builder is better than no credit card in building up a credit history. If all you are being offrered is sub-prime cards, it is becauise you have no history!

However, have you tried where you bank? They maybe a bit more receptive as they hold some history of how you have conducted your account. Even better if they offer you some form of rewards card.

Hi there. I haven't been offered any cards yet, including where I bank, as I haven't applied for any. The reason I haven't tried at the place I bank is because I don't want their credit card offered if it's not the most beneficial card out there for me. 

the_tiramisu_tyrant

Mark_d said:

How good is your credit report?  You can check credit scores with apps from Experian, credit karma and clearscore.  Although you've never had a credit card, rent payments, utility bill payments, mobile phone bill payments might appear on your credit report and therefore contribute to a good score.
You should also be checking your credit reports for errors.  You don't want to state getting declined for things because of an error on your credit report.

The type of credit card you can get depends on your income/affordability as well as your credit history.  Some website can give you an indication of  cards you'd be eligible for, based on nothing more than a soft credit check. 

Ever since I was 18 I've used a cashback/rewards credit card - repaying in full by direct debit each month.  Because I'm very frugal - I need good reason to spend more than the minimum on anything - I consider myself very safe from spending more than I earn.

Your first goal here is the mortgage.  The £100 you earn from credit card cashback will be insignificant to any savings you make by getting a good mortgage deal.  I would then pick a bank that would give you a reasonable mortgage - and move my current account and credit card to them.  I think First Direct and Nationwide are both good options.  As the bank would have visibility of all your transactions they will be able to help you best when it comes to a mortgage.

Hi there. Last time I checked my credit score was 625. What is the best tool for figuring out which bank would offer the best mortgage when I am 2/3 years away from wanting to get a mortgage? Are there any specific types of cards that are best for building credit with the sole purpose of getting the best mortgage offering in future?

Jami74

The score/number doesn't really mean anything. Do an eligibility check/soft credit check for which ever credit card you fancy and if they offer you one then you can accept. Set direct debit to pay in full and use it a little bit each month. It doesn't need to be any more complicated than that.