Information Request!

PeeWee

I dont want to bore you with a whole load of rubbish, however a little history before I ask my question!

Up until recentley when I set up my own business I have never really needd credit, all our credit has been in the other halfs name!

on my credit file I have a default for £900 which has now been settled and is 2 years old. I have settled this now but combined with my 0 good history has given me a few problems getting credit.

I have manged to get a secured captial one card, i have had it for 3 months now, also after an article I read somewhere I applied for an Egg card, although I got turned down initially, I applealed and after a 30 Minute phone interview I was accepted butwith only a £500 limit.

Although I dont need the credit I have used both cards to 90% of their limits each month, and I have Direct Debits set up to pay the full amount each month.

After reading through various articles on this site, I got my 3 credit reports from checkmyfile (excellent service by the way) I have also (thanks to this site) become aware that using a high % of my available limit each month is not considered good by most lenders.

Now to the question. beacuse I go to 90% of my limit on both cards each month, then paying the full amount AFTER the statement is released, on my crdit file it always says I am at at 90% of my availbel credit, which is seen as bad....

Therefore would it be much better to clear off the about 80% of my balance just before my statement is produced? If I am right this would surley mean that according to my credit file I would only be using about 10% of my available credit????

I hope the above makes sense, and I look forward to your answers!!

Reaper

I can't speak for the credit card companies but if your credit limits are very low then I can't see them being particularly worried that you have used them up.

It is more a problem which affects stoozers with large credit limits used to the max.

Most important is seeing that you are making your paymemts on time every month. The importance of that dwarfs the lesser fact you are making full use of them.

Also remember they don't have a historical record of your balances every month on the credit report, just your current balance. So if it worries you just pay it off early (or don't use the card) just before applying for any new credit.

Joe_Bloggs

I have once tried to pay egg via, BACS transfer, before a direct debit was due by about five working days. They ended up taking the money via direct debit anyway.
This could have caused problems/charges/cashflow issues etc. ,if my current account was close to empty or an overdraft limit.

Build up trust with your credit card companies by paying on time. They will eventually reward you with higher credit limits and an improved credit record. You can request limit increases from egg online but I would wait a while so they can come to terms with the card usage.

There will always be the temptation to overstretch your credit and risk a cashflow crisis in the event of more business/need for investment. Seek advice if this becomes a factor.

Congratulations on appealing to a credit card company and getting the card.
J_B.