Denied Credit Card

Steve123456789

I did an eligibility checker for a credit card (which I only want to build my awful 219/1000 credit score) with Santander.

It said they can't offer me a credit card.

I'm 32.
I own my £360k house with no mortgage. Paid £240k for it - £75k deposit and paid off £165k in 5 years with my wife
Never missed a payment on anything, even a library book.
I have a phone on contract.
I've had a credit card with them in the past but didn't need it so I closed it.  I never actually needed it.
I have over £100k in my S&S ISA.
I'm the director of my own company in its second year.  Last year I only took home £20k (which I put on the elegibility checker)
The company turned over £115k and made £70k in profit.  In its first year.
We have 2 young kids which cost maybe £5 a day to run, between them.

If I can't get a credit card I don't even need, how can anyone get a credit card? What do I do?  Credit scores make no sense at all.

lr1277

No experience in this area but the following stand out:

On this board/forum it is always said credit scores are meaningless and the only people who see them is you. But 219/1000 is low. What else is in your credit file? How long ago was the mortgage paid off? More than 6 years and it may not show on your credit file. Is the only line on your credit file your pay monthly phone contract?

You seem to meet the minimum income level for a Santander Edge credit card which I think is just over £10k.

Is Santader where you hold your personal current account?

Normal advice is check your credit file. You can use the free MSE credit club. And if there is nothing untoward, apply for a credit card at the bank where you hold your personal current account (assuming said bank offers credit cards). 

Edited to add: I paid off my mortgage in 2018. Though I cannot remember how long it stayed on my credit file. Also the other complications is that I use the MSE Credit club who used to use Experian as their data provider and now use Transunion. Experian provided more data than Transunion. But the completed mortgage no longer shows on my credit file.

On my current credit report, along with my current account and credit card, there are entries for my mobile phone contract and energy supplier (new). At a previous address with a different water supplier, my water company was listed on the credit file.

Steve123456789

lr1277 said:

No experience in this area but the following stand out:

On this board/forum it is always said credit scores are meaningless and the only people who see them is you. But 219/1000 is low. What else is in your credit file? How long was the mortgage paid off? More than 6 years and it may not show on your credit file. Is the only line on your credit file your pay monthly phone contract?

You seem to meet the minimum income level for a Santander Edge credit card which I think is just over £10k.

Is Santader where you hold your personal current account?

Normal advice is check your credit file. You can use the free MSE credit club. And if there is nothing untoward, apply for a credit card at the bank where you hold your personal current account (assuming said bank offers credit cards). 

House bought in Dec 2018.  Totally paid off and owned outright in Dec 2023.

I'm looking at clearscore and my address is wrong.  It's 2 addresses ago, when I was renting, before I was renting, before I bought this place.  I thought this updated itself, was linked to my credit file and knew as much about me as I know about me?

So there are 10 lines on it as far as I can see.

1. "action needed - Get a credit card"

2. "monitor - You don't have a mortgage"

3 - 10.  "doing well" - Everything else. No loans, reposessions, CCJs, missed payments, long electoral roll etc.

Yes, we have a joint account with santander with £17k in it.

The only negatives on my credit file I can't rectify.  I don't have a mortgage (trying to get one for £28k to move house) paying the rest of the £79k difference with cash.
And credit card, my own bank I've been with for 11 years won't let me.

Capital One seem to say that I'm elegible but do I want a CC with these? They sound very Barclaycardy - high interest rates, nightmare to deal with.

TBH, I don't even know how to pay a credit card bill because I'm good with money.  Only one I've ever had, I had for 5 years and it automatically paid off in full every month from the Santander acct it was next to.

Looking at my credit rating it's been poor for ages.  422 until Sept 2023, then down to 219 since.  Paid off my £165,000 mortgage 3 months after it went down to 219 and it didn't move.  Crazy. Something can't be right.

lr1277

Must admit I thought there was a minimum  mortgage amount, maybe around £30k - £35k. Less than this figure and I think you can get a personal loan. But not sure about that.

Not sure why you want a credit card. But it really doesn't matter about the brand of credit card. As long as you stay within the limit and pay it off by direct debit, then your credit file will see improvements.

Just make sure the terms of the credit card are not onerous or unexpected. You are meant to get upto 56 days interest free credit based on the billing cycle. Some cards take the money early (i.e. before the 56th day (based on the billing cycle)). Amex takes the money early and I am led to believe for certain John Lewis cards they take the money a week before the due date if paying by direct debit. JL's reasoning is if the direct debit fails, then you have time to make a manual payment.

lr1277

The address thing might be a problem, though I don't know how you update it. You might get an answer on this board. There is also the credit file board where you might get an answer.

Or you could talk to Santander pointing out this discrepancy.

Steve123456789

lr1277 said:

Must admit I thought there was a minimum  mortgage amount, maybe around £30k - £35k. Less than this figure and I think you can get a personal loan. But not sure about that.

Not sure why you want a credit card. But it really doesn't matter about the brand of credit card. As long as you stay within the limit and pay it off by direct debit, then your credit file will see improvements.

Just make sure the terms of the credit card are not onerous or unexpected. You are meant to get upto 56 days interest free credit based on the billing cycle. Some cards take the money early (i.e. before the 56th day (based on the billing cycle)). Amex takes the money early and I am led to believe for certain John Lewis cards they take the money a week before the due date if paying by direct debit. JL's reasoning is if the direct debit fails, then you have time to make a manual payment.

Mortgage adviser seems to think that this amount is fine.  Interest rates are better than on a personal loan.

How do you set the credit card up to pay automatically? Do you ask your bank account to send money or ask the credit card to charge your account?

I just want it to improve my credit rating.  Doesn't seem right to have such a bad credit rating when I'm not someone who will miss payments. Improves rate on mortgatge too I believe, although that ship may have sailed.

Lloyds elegibility checker says I can have a CC with £1900 limit.  
I don't have a Lloyds account. Can you get a credit card like this with a bank you don't bank with? Do you get given some details to log in online and see your balance etc?

Brie

There needs to be something happening to update the credit agencies.  It's possible that you may have signed up for your bank to NOT report to the credit agencies.   But you can go online and add a note to the credit file to correct incorrect/out of date info.  

And it's a dumb situation - you can only get credit if you already have credit.  

So apply for the worst of the credit cards.  Aqua, Vanquis.  Eye watering interest charged on balances but you just make sure it's paid off every month.  And do use it - maybe just to fill the car or to buy a coffee once a week.  Set the DD to "pay in full".  Use it for 6 months and then try a more mainstream card.  I wouldn't suggest Barclaycard as they seem to be very strict with their credit limits these days which makes them useless for a lot of people.  Cap1 is fine, MBNA is easy to get along with and their online system is dead simple.  M&S can be good - go in an buy something and get their card to pay for it.  

Having a card is a good thing if you are booking holidays or renting a car somewhere.  And they have a certain amount of purchase protection built in which is handy if something goes wrong with something you buy with it.  

Was your mortgage at the same bank you currently use that refused you a card?  If it was a different one then maybe wait a couple of months and apply to the mortgage bank for their simplest card.  They will know about your mortgage and that might help you.

Alternative thought - does your other half work?  Could they apply for a card if one is needed for the family??

molerat

Lloyds elegibility checker says I can have a CC with £1900 limit.  
I don't have a Lloyds account. Can you get a credit card like this with a bank you don't bank with? Do you get given some details to log in online and see your balance etc?

Credit cards and general banking operate as separate entities, yes you will be given a link to set up on line access to the card account.  When you get the card you set up a direct debit with them to take the full statement amount every month and as long as you have enough in your bank account it just looks after itself.

Your problem seems to be very little credit related activity, a fairly low income and possible address mismatch.

lr1277

As @Brie suggested, when I have applied for credit cards in the past, as part of the application you can indicate your preferred repayment method. Once you have the card you can change your repayment method but if you never want to pay interest, choose paying by direct debit from the get go.

Also ensure you never withdraw cash on the card as you will pay interest and the fact will be added to your credit file and it will be viewed negatively by future lenders.

A wrinkle is that certain (online) retailers who supply gift cards classify the transaction as a cash withdrawl even though you are buying something. This will attract interest and as I said will be added to your credit file. In those situations, you are better off paying by debit card.

Edited to add: Yes in theory you can get a credit card with any provider as long as they accept you as a client. For certain banks like First Direct, you can only get one of their credit cards if you hold a current account with them.

Steve123456789

Brie said:

There needs to be something happening to update the credit agencies.  It's possible that you may have signed up for your bank to NOT report to the credit agencies.   But you can go online and add a note to the credit file to correct incorrect/out of date info.  

And it's a dumb situation - you can only get credit if you already have credit.  

So apply for the worst of the credit cards.  Aqua, Vanquis.  Eye watering interest charged on balances but you just make sure it's paid off every month.  And do use it - maybe just to fill the car or to buy a coffee once a week.  Set the DD to "pay in full".  Use it for 6 months and then try a more mainstream card.  I wouldn't suggest Barclaycard as they seem to be very strict with their credit limits these days which makes them useless for a lot of people.  Cap1 is fine, MBNA is easy to get along with and their online system is dead simple.  M&S can be good - go in an buy something and get their card to pay for it.  

Having a card is a good thing if you are booking holidays or renting a car somewhere.  And they have a certain amount of purchase protection built in which is handy if something goes wrong with something you buy with it.  

Was your mortgage at the same bank you currently use that refused you a card?  If it was a different one then maybe wait a couple of months and apply to the mortgage bank for their simplest card.  They will know about your mortgage and that might help you.

Alternative thought - does your other half work?  Could they apply for a card if one is needed for the family??

I don't NEED a CC.  It's just to build up my credit score.

My wife has one and her score is over 900.

She also hasher phone, our closed mortgage and loads of old current accounts listed on there (we have switched accounts about 5 times in the last year to get the sign up bonus) whereas I have literally none of these listed under accounts.  Nothing.

surreysaver

You DO need a credit card if you want to improve your credit rating. You need to play the game and feed the machine if you want the machine to give you what you want