If you have a less-than-perfect credit score it can feel like your credit options are limited. But our Credit Monitor app only shows you the credit cards you’re likely to get, taking away some of the uncertainty of whether your application will be accepted or not.
Building a history
Through Credit Monitor we use your credit score to show you which cards you’re likely to get. If your credit score is poor, the cards you’ll be shown will most likely have the following features:
- Low credit limit
- High interest rate
- Limited promotional offers (i.e. balance transfer or money transfers)
These features are designed to help you manage your credit card in a responsible way. The low credit limit lets lenders see how well you manage your account, while reducing the risk that you’ll end up in debt. Providing you consistently show you can stay within your limit and make your repayments on time, your lender could increase your credit limit or reduce your interest rate.
Alongside this, you should also see your credit score increase; as your lender will update the details it holds on you to main credit reference agencies to show that you’re using your credit responsibly.
An improved credit rating could help you later on if, for example, you need a mortgage to get on the property ladder, or you need to take out a personal loan to buy a car or make any other major purchase.
These types of cards are often called ‘credit builder cards’ and are designed primarily to provide a solution for those with a low credit score, through either mismanaging their finances in the past, or through having a limited credit history.
What to watch out for
The downside of these types of credit cards is that they usually charge much higher annual percentage rates (APRs) than standard credit cards.
That means if you pay off your balance in full each month, you won’t be hit with steep interest charges. If you only make the minimum payment each month, the interest could mount up and you may struggle to repay what you owe.
If you’re worried about remembering to make monthly repayments on time, set up a Direct Debit at the outset so that you pay off your balance every month automatically.
Other ways to improve your credit score
Using a credit card responsibly isn't the only way you can boost your credit score.
The Credit Monitor app lets you see your full credit report and score for free. We’ll update you monthly on the potential reasons why your score has changed, and personalised steps you could take to improve it.
By having access to your full credit report, you can also review the account information held about you. If, for example, your report shows that you’ve missed a repayment in the past, and you know that isn’t the case, you can get in touch with your credit provider and ask them to amend their records. If they won’t, you can put a ‘notice of correction’ on your report yourself, explaining why the information showing is incorrect.
We’ll also keep an eye on your credit file and let you know about any activity that could be suspicious, and might damage your score, such as someone opening accounts in your name.
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