First Credit Card Mistake

Ch1ll1Phlakes

Hi all. I recently helped my fiancée get a credit card to help her build a positive credit history as part of our future planning as we intend to buy a house together within the next 5 years and therefore apply for a mortgage together. She has pretty much no credit report with no loans, credit cards, mortgage or even a phone bill in her name.

Unfortunately, she accidentally made a cash withdrawal without realising that this type of transaction carries extra fees and can negatively affect credit. She made this withdrawal when visiting her grandad in the hospital as her dad needed some cash and I think this played a part in using the credit card as it was on hand. However, I must take some of the blame for this as she was a bit wary of credit cards with their negative image and I assumed she knew not to make a cash withdrawal with it. My bad. As soon as we noticed, we cleared the total balance of the card immediately and made sure that we wouldn't use credit cards for cash again. 

My query for the forum is this. I know that cash withdrawals from credit cards leave a mark on your credit file. Is it possible to have this mark removed due to the mistaken nature of the withdrawal (I know this probably isn't likely)?

If not, how likely would this be to affect a mortgage application? Like will one small mark such as this cause many issues if there are no other issues or massive debts on my fiancée's credit report? I don't want the card that was meant to help her credit report end up negatively effecting it. 

Thanks for any help.

molerat

A one off is unlikely to have any real negative effect.  Just keep on using the card and pay it off in full each month.

fatbelly

It won't make any difference.

Get her to check her file. It should show her being on the electoral roll and should show her bank account. There may be some other stuff on there

eskbanker

Ch1ll1Phlakes said:

My query for the forum is this. I know that cash withdrawals from credit cards leave a mark on your credit file. Is it possible to have this mark removed due to the mistaken nature of the withdrawal (I know this probably isn't likely)?

It's not a 'mark' that can be 'removed' as such, but the fact that cash was withdrawn from a credit card will be visible to the rating agencies, who may reflect it in the 'scores' they invent, but, as above, a single occurrence is unlikely to be of any interest to prospective lenders, especially years down the line.

CliveOfIndia

I have to agree with all of the previous comments - a single cash withdrawal will make not the slightest bit of difference to her credit history.

The record of the cash withdrawal will remain on her history - it can't be removed as it's simply a factual record of the transaction.  But it really is nothing to worry about.  It would be a different matter if she was regularly withdrawing cash - that would start to ring alarm bells to lenders.  But a single withdrawal is neither here nor there.

kimwp

When I was applying for a mortgage, the financial advisor I used said it was more important how long ago the marks were than what they actually were (I'd missed a payment on a couple of credit cards as I was on an internship abroad and hadn't set up automatic payments)

Olenna

kimwp said:

When I was applying for a mortgage, the financial advisor I used said it was more important how long ago the marks were than what they actually were (I'd missed a payment on a couple of credit cards as I was on an internship abroad and hadn't set up automatic payments)

This isn't a negative mark as such - unlike like a late payment marker.

If there are no actual negative markers then it will get ignored (if a one off or only used occasionally) but regular usage can indicate financial stress along the same lines as regularly only making a minimum payment. That's why using fee free travel credit cards such as Halifax Clarity for ATM withdrawals aren't given prominence.