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Rebuilding bad credit history

Discussion in 'Personal' started by thelovelyliz, Jul 27, 2012.

  1. Any pearls of wisdom?
    Also, how long does it take? Ours has taken a terrible battering, I am ashamed to admit, but feel as if I desperately want to get it all sorted this next year.
  2. BelleDuJour

    BelleDuJour Star commenter

    I'm not sure other than to pay creditors on time, not go overdrawn and all that. But I have heard it pays to get one of those mega high interest credit cards for those with poor credit history, us it once or twice a month and ALWAYS pay off in full. For some reason, having a credit card and paying it off gives you a higher score than not having one at all.
  3. Which to me, seems crazy, in Germany you wouldn't get a credit card with a bad credit rating! But I have often read that that is what it takes in the UK.

  4. giraffe

    giraffe New commenter

    Credit history is a bit of a mystery to me.
    Owing money isn't an ideal to be fulfilled, and debts should be paid asap in my reckoning.
    If your credit rating is poor, then it means you can't easily get into more debt, surely?
    I know times are tough, but paying extra to money lenders doesn't make any sense really.
  5. I have a 'fair' credit rating according to my credit report. I have never paid anything late. I manage my money. I don't understand why it's not good. The only thing I can think of is the fact I have hire purchase on a car.
  6. Well yes, quite.
    But we do have a mortgage so over time, if that and that alone is repaid on time I assume our credit history will repair itself? Or have I misunderstoof anything? [​IMG]
  7. Sign up for a free trial with something like credit expert.
  8. giraffe

    giraffe New commenter

  9. roverlei

    roverlei New commenter

    I think BelleDuJour is correct.

    You need to get whichever credit card you can, even with just a £100 limit, buy a couple of your regular monthly items on it each month and then PAY IN FULL.

    All they want to see is that you have the capacity to repay, and are reliable in doing so. Good luck.
  10. giraffe

    giraffe New commenter

    TES is moderating my post which had a link to moneysavingexpert.com

  11. Anonymous

    Anonymous New commenter

    The best way is not to pursue credit at all.
    My credit rating has been beyond grim for decades. I have no intention of making any move to "improve" it - especially if that means any sort of credit card for any reason.
    I'm now finally out of debt and intend staying that way so credit rating can go get stuffed.
  12. Seren, I have no intention of getting any other credit either.
    However, having a poor credit rating does spell disaster should we need a loan, car finance or more likely to move house and get another mortgage.
    What I really wanted to know was if a bad credit rating improved itself slowly over time.
  13. giraffe

    giraffe New commenter

    Loan.. car finance... these are credit
  14. To be honest, no. You have to see where and why your rating is low. Then you can do something practical about it. It may be something that is mistakenly on your credit file. That is why I suggested Credit expert. It will show you an in depth profile of your credit rating and suggest ways to improve it...not always by taking out another card.
  15. giraffe

    giraffe New commenter

    Trying again. This is useful.
  16. grumbleweed

    grumbleweed Star commenter

    Trouble is, a bad credit rating isnt just about getting more credit. My daughter has seriously bad credit rating after doing some stupid things in her youth, and now just cannnot move house. She lives in a pokey flat with a toddler and no garden, and just cannot get anywhere else to rent as the credit checks always come back too poor, even though she has a guarantor (me!), and good references. It is very frustrating as I cant afford to pay rent for her, but she does deseve a chance now that she is back on the straight and narrow, and has been for 2 years now. But she doesnt have any credit cards, as she wouldnt be able to get one anyway.She has been advised it will take approx 6 years.

  17. enigma23

    enigma23 New commenter

    Afternoon all

    As someone who had 'debt' and lots of it about 2 years ago, I was surprised by my credit score actually being quite good. As someone mentioned on here, having no previous credit doesn't actually go in your favour. My 'masses' of debt actually went in my favour and I repaid everything in full without missing a payment - this is the key part! Having debt doesn't actually go against you, it's missing payments that does. I started with the minimum payments until I could afford to pay more, then using moneysavingexpert I looked for balance transfers and slowly but surely I managed to pay it all off.

    Whilst your 'history' cannot improve, your 'future' credit history is of your making. Use the website and look for good deals as well as a balance transfer to a 0% card to further reduce your debt - at one point I was paying just interest alone on my credit cards and not even touching the balance - I am horrified when I look back now at all the money I have paid in Interest over the years but you learn eventually!

    I do suggest the free trial on credit expert as this will give you a full and frank breakdown of your financial commitments and the payment history of these, and it can show you your most pressing debts or your highest repayments/interest payments.

    I took control of my financial 'mess' just as you are now and I'm so glad I did!

    Best of luck!

  18. gruoch

    gruoch Established commenter

    6 years is correct. It is possible to get mitigating circumstances added to your credit rating.
    It can be a bit difficult to find on the sites, but the rating agencies have to provide a credit history for £2. It's worth doing. I found some totally spurious stuff on mine, associated with an address I've never lived at. They correct errors very quickly in my experience.

  19. Unfortunately the bad credit is all ours - I do wish it could be pinned on somebody else!
    We've had years of financial hell but desperately want to move on from it. It is difficult though because we can't get credit to show we could now use credit.
    Giraffe, the problem is that our options (when it comes to for example moving house as someone has said) are limited. For example, a few months ago, my husband's car (which he has a very genuine need for) needed repairs of £800. With good credit, we could have used an overdraft or got an interest free credit card - as it was, these options weren't available to us with the result of a further mess. It is tricky.

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