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How will I ever improve my credit score??

Last post Tue, Apr 21 2009, 6:11 PM by Tofolo. 7 replies.
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  •  Tue, Apr 21 2009, 6:11 PM

    Re: How will I ever improve my credit score??

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    Hi

    To answer the question 'is it worth getting 2 pre pay cards' i would like to stress - Pre Pay cards do not improve your credit rating!

    The only one i know of is Cash Plus and THEN you need to add the Credit Builder. The credit builder is a form that you print out and post back - its a loan agreement that you will pay £5 a month for 12 months but the £5 is the same as the monthly subscription to the cash puls card. this is so they garentee your customer for a year and you get an improved credit rating -

    I am not alowd to post inks so please google Cash Plus and read all about it, it is recomended and commended for what it does and i can tell you that it does what it says on the tin. just dont miss any payments or it looks like a default.

    If anyone else knows about a pre pay card that can do the same as cash plus credit builder then please post so we can see it but i dont now of any other card.
    • Post Points: 5

  •  Tue, Apr 21 2009, 5:04 PM

    Re: How will I ever improve my credit score??

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    Does anyone know if it's worthwhile getting 2 different pre-paid credit cards to build credit score?
    • Post Points: 20

  •  Mon, Apr 20 2009, 5:46 PM

    Re: How will I ever improve my credit score??

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    Hi MellyR,

    In addition to the excellent advice - especially from Tofolo - you may find the article by our credit card expert, Peter Harrison of help: How to improve your credit score.

    We've all been there and as I'm sure the majority of our community members will agree - as with everything in life, it's about learning. Debt in itself isn't necessarily a bad thing - it's about how you manage that debt that is the important thing.

    All the very best and do let us all know how you get on.

    I hope that helps.
    • Post Points: 20

  •  Mon, Apr 20 2009, 1:20 PM

    Re: How will I ever improve my credit score??

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    Hi you need to do a few things - I was in your situation in 2002 / 03 and am only now getting out of it. From what I have learned there are a few things you need to do -

    1) Credit file

    Get your credit files. apply to Experian, Equifax and Call credit. All are offering free trials right now and you can sign up, view your files and close the free trials. This way you know Who you owe money to, how much, the status of the accounts.

    2) Remove the bad marks:

    To get the defaults off your credit file there are 2 ways. 1) if the account is still open keep it open 3 years after the last default and it will get pushed off - they only keep 3 years of repayments. 2) if you have closed the accounts or they are defaulted and closed then it takes 6 years to disappear and option 1 is no longer available to you. However if you still owe money contact them or the debt company and see if they will take a settlement fee (usually about 30 /40% off the balance. If they do pay it and your account will show settled - then add a not of correction explaining what happened and how you fixed this - the credit agency will help you do this.

    3) Register to vote - without this companies cant confirm your address so get on the electoral register

    4) Get positive repayments on your file - if you have a credit card or loan that has not defaulted then paying it can put positive marks on your file

    5) Stop applying for credit - to may applications look like you are desperate for credit and searches stay on your file for at least a year so only apply 6 months apart. -

    6) Pre pay cards - if you cant get credit then consider cash plus as a pre pay card. You pay £15 for it and £5 per month BUT you then open a credit builder with them. It costs noting but the £5 a month you would already pay. After 3 months they report to the credit agency susses full repayments and after a year it looks like a loan has been repaid - all positive marks on your credit files. If you cant get anywhere I strongly suggest you look into Cash Plus but you must apply for the card then apply for the credit builder and do not miss a payment to them in a whole year. for £60 it makes a positive impact on your file and shows you can Handel credit.

    7) Consider capital one or vanquis credit cards - making payments on credit cards on time leaves positive marks on your record - if you cant get a credit then do point 6 for a year as this will show an improved credit file-

    8) Close any unused credit - in this financial credit crunch if you have a lot of unused credit you are a risk to companies as you could just run it up quickly and that makes you look an unacceptable risk - but if you have credit that you are not using then you dont need to apply for more.

    Finally be aware of your credit ratings with all 3 agencies, Google 'who uses who' to see what companies use what agency to credit check. Don't apply if you have multiple accounts in default and try to live on cash while time passes and your old debts clear. I pay all 3 agencys every month so i can see exactly where i am and i now have a clear rating with no defaults on all 3.

    I have been there and it took me 6 years before I could apply for credit sucssesfully and even then I had to get a card charging 40+% interest. I pay it off all the time and soon I am sure I will have a better rating in the next year.

    oh the mistakes of youth

    Good luck
    • Post Points: 20

  •  Thu, Apr 16 2009, 2:04 PM

    Re: How will I ever improve my credit score??

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    Well it will all depend on the defaults you have recieved as they can make a difference to your score/rating. Best thing for you to do would be to contact someone like experian and get your credit score now. Then use your prepaid card (some cost approx £5 a month for the priviledge) and put the amount that you would spend on petrol, food etc normally for the month and use the card (important to make sure their is enough on the card to cover these things and that your prudent in its use). I noticed a big improvement within 3-6 months. But please bear in mind that i did not have any defaults in the last 3yrs at the time and im not exactly sure how the agencies score people. Check your score every couple of months and see how you get on.

    Also you may find this artical useful http://www.moneysupermarket.com/c/news/how-to-improve-your-credit-score/0004547/

    Good Luck
    • Post Points: 5

  •  Thu, Apr 16 2009, 1:51 PM

    Re: How will I ever improve my credit score??

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    thanks very much for your reply and help! can i ask you how long it took for you to see a difference in your credit rating months or years???

    thanks again!
    • Post Points: 5

  •  Wed, Apr 15 2009, 3:30 PM

    Re: How will I ever improve my credit score??

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    Hi,

    I was in the same situation, i didnt know where to turn, until someone on this forum gave me the answer i needed. Its all about prepay credit cards. There are a few on the market and i believe there might even be a few listed on the Moneysupermarket search/compare options. Basically the principal is simple, a pre paid credit card that you can use in the same ways as a normal credit card, but effectively only spending what you put on them. Its a great way to stablise your credit rating and in turn slowly improve it, be careful with them and you will see the rewards.

    Hope this helps
    • Post Points: 20

  •  Wed, Apr 15 2009, 11:31 AM

    How will I ever improve my credit score??

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    A couple of years ago whilst I was a student at University I was very silly with my monthly payments for credit cards and loans which ended in receiving 3 defaults on my credit report! Since then I have paid off all outstanding debt excl. car finance which will be paid off this Nov 09. After then I will have no outstanding debt which I am now being told this will go against me as I am not showing how I can manage my debt/money. I have tried recently to apply for credit to bring my credit score back up to 'good' but I am finding no one will give me credit at the moment either due to the old defaults or the fact I dont have much credit on my report. Please can you advise how I am ever going to be able to improve my score if no one is going to give me the chance of building my credit back up???? I would like to apply for a mortgage with my partner at the end of this year but I am worried I will declined for this as well!! I thougtht i was doing a good thing by paying off my outstadnig debts only to find out I have made the situation worse for myself!!
    • Post Points: 50
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