Improve Credit Rating!!

Lipsticklady

Hello,

I am currently enquiring about a mortgage however, i have no Credit history!
Having been a student you may have thought i needed loans etc but as i worked at the same time i paid off all my fees and living costs and never needed to get in debt.Even now i have graduated i have no debts!

Being a avid saver i would have thought that i would be a good person to lend to. I have saving accounts (unit trusts & ISA's). I have never been indebt.....always in credit !

How do i improve this situation without getting in debt!!!!

grumbler

Lipsticklady wrote:

Having been a student you may have thought i needed loans etc but as i worked at the same time i paid off all my fees and living costs and never needed to get in debt.Even now i have graduated i have no debts!

Being a avid saver i would have thought that i would be a good person to lend to. I have saving accounts (unit trusts & ISA's). I have never been indebt.....always in credit !

:T :T :T

How do i improve this situation without getting in debt!!!!

1. In your situation the main factor that lenders will consider is your salary. Being on electoral roll could help too. I think the fact that you don't have any credit history is not very important. Actually you probably have some without knowing this - for example, if you have or had contract mobile phone.
2. However, it is better to have credit history. And you don't need to get in debt for this. Having a credit card and paying balance in full every month is very handy for you, don't cost you anything and halps to build a credit history. Some cards even pay about 1% cashback when you use them for purchases.

lipidicman

Get a credit card - use for disciplined spending (ie as you normally spend) and pay off in full by DD. An added bonus is you get interest on the money still in your current account - with a 9month 0% card this gets better (only make the minimum payments, still helps your credit rating!)

I'm doing this myself as I was in the same situation as you - I was pleasantly surprised at the credit limit I got though (it may have helped that I picked a bank that I have a lot of savings with as many do their own internal checks as well as using experian etc)

Fatboy_NSS

Actually a mortgage is probably the easiest credit to get if you don't have a credit history. Unlike credit cards or personal loans, the lender knows that if the worst comes to the worst they will be able to get back the money they lent you by reposessing the house. Your lack of credit history will probably mean you have to prove your income, but as long as you can do that getting a mortgage shouldn't be a problem.

Lipsticklady

Thanks everyone for your advice....think a credit card is the answer. Unfortunately, i have never been on a contract phone only PAYG. Typical moneysaver........over cautious!!!!!

dunstonh

There is no such thing as a credit history/rating.

Indeed, applying for a credit card just before the mortgage could do more damage than good as too many credit scores in a short period would be held against you. Especially if the CC was declined.

As long as you are on the electoral roll, employed, got a home telephone and your bank statements show healthy ins and outs with no bounced items, you should be fine if you are borrowing within your affordability.