Capital One - Been accepted - Now what?

Snooze

Careful_with_that_Axe wrote: »

Rob
Thanks for the advice on leaving a small balance hadn't heard that before - it may increase likelihood of Cap1 increasing limit, but will it also not look slightly negative on credit file?

In my opinion, no. There are people out there with perfect credit files (ie. credit score of 1000, always pay in full and on time, blue chip job for the past 30 years, big income, on electoral roll, on OSIS, good ACORN area, lived in own house for past 30 years etc) who apply for new cards and get rejected :eek: and the simple reason for it is because in the eyes of the lender they're not a good customer because they won't make them any money.

You've got to remember that the banks and credit companies are not charities, they are profit-making businesses and they don't make any profit from you paying all your credit back in full and on time. In fact, suffice to say they'll be making a loss when you consider the costs of the admin involved to answer phones and post statements out etc. If you make them some money by only paying part of your balance then that's far better in their eyes than someone with a perfect credit rating who pays in full each month.

It's like the 0% deals they offer on credit cards. They are making a loss each month on those through admin costs, but rely on you not transferring your outstanding balance when the free period runs out, so you then end up on 30% APR and the bank sits pretty watching the money roll in.

Take the credit stoozers as another example. These people are the last people that the credit companies want as customers. They don't make them (the credit cos.) any money whatsoever and if they could predict in advance what they were planning to do then not one customer would get accepted.

Youv'e got to think how they think and play them at their own game.

Rob

Leigh73

neil.b wrote: »

Did you check the interest rate?

I applied for the low interest rate but got turned down, instead they offered the 29% interest.
I took it anyway just to build up the credit rating and was very suprised when it had a £500 limit.
I pay it off in full each month so not worried about the high rate.

Neil

Sorry to hear that you didn't get the low interest card Neil.

I don't know what my interest rate / limit is yet, but I suspect it'll be high / low, respectively!

Typical rate I think they said in the letter, was 34%..gulp :eek:

However, like you, I'll only be utilising this card in order to improve my credit standing

G-G_4

Thanks Leigh

Leigh73

Snooze wrote: »

In my opinion, no. There are people out there with perfect credit files (ie. credit score of 1000, always pay in full and on time, blue chip job for the past 30 years, big income, on electoral roll, on OSIS, high ACORN area, lived in own house for past 30 years etc) who apply for new cards and get rejected :eek: and the simple reason for it is because in the eyes of the lender they're not a good customer because they won't make them any money.

You've got to remember that the banks and credit companies are not charities, they are profit-making businesses and they don't make any profit from you paying all your credit back in full and on time. In fact, suffice to say they'll be making a loss when you consider the costs of the admin involved to answer phones and post statements out etc. If you make them some money by only paying part of your balance then that's far better in their eyes than someone with a perfect credit rating who pays in full each month.

It's like the 0% deals they offer on credit cards. They are making a loss each month on those through admin costs, but rely on you not transferring your outstanding balance when the free period runs out, so you then end up on 30% APR and the bank sits pretty watching the money roll in.

Take the credit stoozers as another example. These people are the last people that the credit companies want as customers. They don't make them (the credit cos.) any money whatsoever and if they could predict in advance what they were planning to do then not one customer would get accepted.

Youv'e got to think how they think and play them at their own game.

Rob

Brilliantly put Rob.

What is 'OSIS' and 'ACORN'?

skyrider007

Don't worry if you get 34.9% APR and a low credit (like £200-500) at first. If you manage your account well (don't go near the limit and pay on time) for four months they will reduce the APR and increase your credit limit.

Leigh73

skyrider007 wrote: »

Don't worry if you get 34.9% APR and a low credit (like £200-500) at first. If you manage your account well (don't go near the limit and pay on time) for four months they will reduce the APR and increase your credit limit.

Thanks skyrider.

It did say on the agreement / letter, that after four months of using the card responsibly for four months, they would increase the limit / lower the rate, so that's great to hear!

I'm guessing they'll probably only offer me £100 though, as some people on these boards have been offered

Snooze

Leigh73 wrote: »

Brilliantly put Rob.

What is 'OSIS' and 'ACORN'?

OSIS = Operator Services Information System. Basically, the BT Phone Book / Directory Enquiries. You're more attractive to lenders if you've got a landline and are listed in the directory.

ACORN = A Classification of Residential Neighborhoods. http://www.caci.co.uk/acorn/. Lenders use this info to get a general picture of the type of person you are. The ACORN site gives each postcode in the country it's own rating. The posh areas with a lot of wealth will receive a low ACORN number (this is what lenders want) whereas the poor areas where there is a lot of crime etc will get a high number (= bad for obtaining credit).

You have to log-in to find out your rating so you'll need to register, but it only takes about 30 seconds to do and get your pass-key. Once you've registered, click on "ACORN type" and then key in your postcode. When the results come up click on the bottom button "find out the financial ACORN type" and that will then give you your ACORN rating.

I wouldn't worry too much about your ACORN rating though. On one of my previous properties it was really low at 41 (41 = low income workers, struggling to buy) but it didn't seem to affect my acceptance rates nor credit limits.

:T

Rob

Leigh73

Snooze wrote: »

OSIS = Operator Services Information System. Basically, the BT Phone Book / Directory Enquiries. You're more attractive to lenders if you've got a landline and are listed in the directory.

ACORN = A Classification of Residential Neighborhoods. http://www.caci.co.uk/acorn/. Lenders use this info to get a general picture of the type of person you are. The ACORN site gives each postcode in the country it's own rating. The posh areas with a lot of wealth will receive a low ACORN number (this is what lenders want) whereas the poor areas where there is a lot of crime etc will get a high number (= bad for obtaining credit).

You have to log-in to find out your rating so you'll need to register, but it only takes about 30 seconds to do and get your pass-key. Once you've registered, click on "ACORN type" and then key in your postcode. When the results come up click on the bottom button "find out the financial ACORN type" and that will then give you your ACORN rating.

:T

Rob

That is very helpful to know.

Many Thanks Rob.

Careful_with_that_Axe

Thank you for the info Rob, has given me some food for thought. Not sure if I could do it though - have been quite "damaged" from being so hard up and in debt for so long and was only paid off by legacy from Mum. Has left me risk averse and extremely debt averse. Saying that, I did only pay minimum by DD month before last as had a 3 week cash flow problem before something matured.
Thanks again for making me think

Careful_with_that_Axe

p.s. sorry to have momentarily hi-jacked your thread Leigh! Do post back when you get the card coz I'm nosy and want to know what credit limit you get!