Need to rebuild a bad credit history? New ‘last resort’ option.
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If the goal is to build one's credit rating, wouldn't it be much cheaper and just as effective to get a pay as you go prepaid credit card?
For instance, here are my calculations for a whole year, spending £10/mnth on the credit card, and topping up by bank transfer (free).
e.g.
ClearCash Prepaid Mastercard - Pay as you go
- Card issue fee = £4.95
- Spend £10/mnth on card= £120
- Monthly Fees: None
- Transaction Fees: £0.25x12=£3
Cost of card= £7.95 ( £4.95 + £3)
I will have received £120 worth of goods/services, using a card that cost me an additional £7.95.
Total cost £127.95
Cashplus Card with CreditBuilder
- Card issue fee = £4.95
- Spend £10/mnth on card= £120
- Monthly Fees: £4.95 * 12 = £59.40
- No transaction fees
Cost of card= £64.35 ( £4.95 + £59.40 )
I will have received £120 worth of goods/services using a card that cost me an additional £64.35.
Total cost £184.35
Won't my credit rating show the successfully repaid monthly bills in both cases?
I've read that repaying your credit cards bills is reported on one's credit report. Or does it not apply to prepaid credit cards?0 -
ClearCash isn't a credit facility, it's a prepaid debit card. It won't be reported on your credit file.If the goal is to build one's credit rating, wouldn't it be much cheaper and just as effective to get a pay as you go prepaid credit card?
For instance, here are my calculations for a whole year, spending £10/mnth on the credit card, and topping up by bank transfer (free).
e.g.
ClearCash Prepaid Mastercard - Pay as you go
- Card issue fee = £4.95
- Spend £10/mnth on card= £120
- Monthly Fees: None
- Transaction Fees: £0.25x12=£3
Cost of card= £7.95 ( £4.95 + £3)
I will have received £120 worth of goods/services, using a card that cost me an additional £7.95.
Total cost £127.95
Cashplus Card with CreditBuilder
- Card issue fee = £4.95
- Spend £10/mnth on card= £120
- Monthly Fees: £4.95 * 12 = £59.40
- No transaction fees
Cost of card= £64.35 ( £4.95 + £59.40 )
I will have received £120 worth of goods/services using a card that cost me an additional £64.35.
Total cost £184.35
Won't my credit rating show the successfully repaid monthly bills in both cases?
I've read that repaying your credit cards bills is reported on one's credit report. Or does it not apply to prepaid credit cards?Credit 'Score' - Don't buy the credit 'score' that Experian, Equifax and Noddle want to sell you. It's an arbitrary number that means nothing when it comes to applying for credit.
ALWAYS HAVE A DIRECT DEBIT SET UP FOR THE MINIMUM PAYMENT ON YOUR CREDIT CARDS, REGARDLESS OF WHETHER YOU PLAN TO LOGIN AND PAY EACH MONTH.0 -
thebritishbloke wrote: »ClearCash isn't a credit facility, it's a prepaid debit card. It won't be reported on your credit file.
OK, thanks, that's cleared it up for me.
I'd just assumed, since they're often referred to as prepaid credit cards, that "prepaid Mastercard" = "Prepaid credit card".
But, of course, I see your proint. A prepaid Mastercard is just a prepaid debit card which you can use to pay where Mastercard is accepted (with exceptions).0 -
It should be noted that if you have creditbuilder on cashplus (it will show as a LOAN on your credit file)
After a few months, you may be offered a iadvance or overdraft (which will show as a CURRENT ACCOUNT with OVERDRAFT), no extra cost to the monthly fee that you are paying but a different type of account on your credit file, a limit, green ticks!
The cash plus account itself is useful so why not use it if you are paying for it anyway!I have numerous qualifications in Business and Finance, Accountancy, Health and Safety and am now studying Law.
Don't rely on anything I write as it may be wrong!!!0 -
Hi all,
The ClearCash website shows credit builder is an available option. I want this to run with the credit builder of CashPlus.
I also would like to buy some much needed items on several catalogues, and upgrade my mobile contact. How long should I wait between applications be without losing the benefit CashPlus can provide?0 -
Hi, I am a user of ClearCash and have been using it for a while and cannot sing it enough praise. Like Cashplus it offers the creditbuilder option.
on the face of it, it looks like the Cashplus card is cheaper, but it isnt... although it has a monthly fee of £4.95 (ClearCash £9.95) it has a high ATM fee of £2 (ClearCash £0.50).
Creditbuilder does work after month 3 but do not just load up a years worth of monthly fees...you have to demonstrate your ability to not only repay but also utilise the service. If you just load and leave it, you will be incurring dormancy fees... something that is clearly pointed out on the ClearCash website...
It is known now as more of a current account and i see from their facebook page they now offer realtime loading at any Post Office whereas all others take1-2 business days.
Anyone looking to improve credit rating i would highlyrecommend!KNOW THE VALUE OF THINGS, NOT THE PRICE:money:0 -
Ah - forgot to mention that Creditbuilder is only available on pay monthly options for both providers - details of the instant loading available on the post office can be found here (if I am allowed to post?)
http://www.clearcash.co.uk/card-loading/load-money-clearcash-icount-post-office/KNOW THE VALUE OF THINGS, NOT THE PRICE:money:0 -
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