Hello everybody, this is my first post, so i'll try not to get to involved and drag on!

I'm 20 years old and 18 months ago moved out of home to live on my own, disaster!

I ended up moving back home about a year later after not being able to pay my rates etc.

So, back at home now and i only have one weekly outgoing of £20 to my parents.

The problem is i still owe money to my water, electricity and council tax (maybe even a mobile bill)

the amounts look like this,

Water - £50 (was £80 but set up a monthly repayment)
Electricity - £230
Council Tax - £250

I can afford to get these payed off by Christmas time, which is great, but i don't seem to be able to get credit anywhere. My bank hates me and even though i've kept my account in excess of £500 credit for the last 3 months they don't want to help me build my credit score. Anything i've applied for has been turned down, loans, credit cards, new bank accounts, mobile phone etc.

What can I do? It seems the whole world is against me! I don't think i am massively in debt (much less than £1,000) and everyone around me is in much bigger debt (sister has student loans and overdrafts total of over £15k) but she gets credit all the time, she has credit cards coming out of her ears!

I'd like to think i am good with money, and thought that not having debit cards, overdrafts, loans etc would make me an ideal person for getting a mortgage etc.

I'm really stuck with what to do, i've written to Experian to get my credit report, but really need your advice. I just want to have a decent score so if i need to get credit i can.

Any response will be appreciated

Alex

I know what you mean.

Friend of mine recently got a mortgage and was refused because she had NO credit. They told her she had a bigger risk than say someone like your sister who has got debt. They just love people like that. Annoying though isn't it.

As you are so young easy to say don't worry for the time being but your credit score will improve in time.

All the best, oh and welcome to any excellent sight.

Without knowing everything it is difficult to advise but based on what you have stated the reason is because of the recent conduct of your credit.

Any lenders doing credit checks will see that you have failed to maintain most of the credit/ repayment arrangements you have started.

Anybody lending you money / giving you any form of credit wants to see that you can repay it. By your own admission you haven't done that. The fact that the amounts are small makes it even worse, if you can't afford to repay an £80 debt for your water what incentive is there for anyone to lend you any money at all.

I would also ask why you have debts totalling £530 but also have a bank account with a minimum of £500 in it. It would appear that you could clear all your debts but dont wish to. Again this makes you a bad risk in the eyes of a creditor as you may not pay them back when you do have the money.

This may seem a little harsh but that is the way credit companies will look at things,

My advice would be clear your debts, open a savings account with your bank - they should let you as that can't get overdrawn - save an amount every month by standing order- don't spend it!!! It will show that you can manage your finances.

It won't help for at least 6 months but it will help. When you apply for a credit card apply with your bank, go in and see a Personal banker, first tell them why the debts arose and show that you have been responsible and able to save - suggest a small limit on the credit card - say £200 or the equivalent of your savings. The Bank doesn't have the final say - the credit card company does but your bank may be able to streghthen your application.

If you get a card spend on it every month and pay it back in full every month, don't miss payments. Slowly,acting responsibly will bring your credit history back to a state where people will lend you money.

Thanks for the replies, feel like i've been hammered now :-(

Ok, well i'm going into the bank tommorrow and i'll sort a savings account out.

I've also been given £1500 by my nan so i guess i'll pay the debts and put the rest in the savings account. Hopefully the bank will see this as a positive thing and try to help my situation.

Should hear from experian soon, will let everyone know!

Thanks again

Alex

everytime you try for credit you create a foot print on your credit rating. your age will have something to do with it and any default notices on bills you have not paid on time.. It is incredibly difficult to afford to live on your own at such a young age and if you want independance you are probably better house sharing with friends..you also have to be on the electoral roll for a while at the same address consistantly for 3 years , moving around will not help...sometimes you will just not meet the criteria required... take heart . i am 38 and still get rejected.....

all the best

welcome to the big bad world. i feel for you, i would hate to be your age in this day and age. but you are very young and have learnt the valuable lesson that if you get into debt ,(no matter how small) your credit worthiness goes out the window. you really must budget for incoming bills, you mention your debtors then say "maybe even a mobile bill" MAYBE!!! cosworth you really should know. you have your whole life before you, the fact that you are seeking help bears you in good stead for the future. advice = set yourself a budget, change your phone to p.a.y.g. pay off all your debts, do "not" borrow to pay them off. use the £500. in your bank ! once all your debts are cleared then change your bank, i feel that if a bank won't help one so young then it does'nt deserve your custom as you get older and hopefully richer. one last hope, if you really need a loan could not your parents stand guarantor ? the best lesson you have learned,= do not flee the nest too early !!! best of luck...

A further comment I would make, although not sure if it is still the case:

As I understand it, paying off a credit card in full each month isnt the best way of increasing your credit score, as the lender doesnt make anything out of you for doing this, and therefore you arent attractive as a loaner.

Maybe someone else would like to correct/support this view?

Fiamold aka Dave

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Dave

P.S. I feel obliged to point out, I am speaking from experience and my own personal views above - I am not an advisor, nor an expert.

IMO ...I don't think that paying off your credit card in full every month does anymore harm than good, either way to your credit rating. It certainly dosn't make the card company any happier, by having a customer that in fact they are not making money from.

But you still earn the good credit rating because you are making the payments on time, the same applies if you only pay the minimum payment amount on time and do not default.

It's the default that makes up a bad record, i.e. late payments, non payments and going over your limit without consent that I think contribute to a bad history.

it is a misconception thinking that the credit card companies don't make money from you if you pay off in full each month. each time you use it the retailer pays the c c co. 3-4 % of the transaction, i spend £12-£15k per annum and pay it of in full each month, the c c co. makes up to £150 + from me per Annum ! everybody starts of in life with a good credit score therefore they can't improve it, however make one default then your rating goes down. fiamold, i agree with you that c c providers prefer clients to pay of the minimum balance each month , but i am sure the loan merchants would look more favourably on clients who pay off in full each month.