[philg]

I have just purchased my BMW half of the car was bought with savings and the other half was to be acquired by a loan.

Here goes 33 self employed, i have had 4 loans in my life all for cars never missed a payment and all have been settled early. Never had car finance or any type of credit. In my whole life i have been over drawn 3-4 time for very small amounts. I own half my house which is mortgaged. No accounts in debit, no loans at the moment, so only my house and bills. Do not own any credit card and never have. I have 1 store card i got, which i only did because i got money off the item, payed balance in full when statement came.

When i took out my first mortgage the guy at the bank said it had been one of the lowest credit scores he had seen. Anyway i have really just carried on life like this, if i want something i save up and buy.

This brings me on to the loan for my car, £6000, I have been offered 10% APR and then 20% by another, why can i not get the best rates IE 7.6%.

I spoke to my brothers girlfriend she does credit checks, and basically told me get store cards and credit cards to bump up my score but just keep them in the drawer at home.

Is this the way we live you need credit to get it, madness.

Anyone offer some advice.

Phil

[AlanQS]

Whilst I think it's utter nonsense, they work on the basis of how you deal with your finances and they need proof that you are a safe risk and one of the easiest ways is having plenty of credit card records which show you always pay your bills on time and in the correct amounts.

I did a credit check on me and my household and found that I was one grade below the rest of the family even though I generate 90% of the income - all because, years ago, I sent a cheque to clear a debit card account which had the wrong date on it. The dumplings had my cheque at least two weeks before the due date but didn't contact me to point out the error until the day after the due date. Although I was charged no interest or penalties since they had sat on their hands for two weeks it still showed up as a missed payment.

As advised, get a credit card and either use it and settle the bills at the end of the month or just put it in the drawer.

[mistry]

As has been suggested to you, get a credit card and and pay it off at the end of the month. Thats the best way to build you rating.

In fact I use cashback credit cards for everthing I buy. means I get at least 1% of all my purchases back. and I've set-up a DD to clear the card every month, so there are no fee's, or worries about not paying it on time.

I normally get a few hundred quid back every year by doing this and it builds my rating.

[chrisbin]

what ^^ they said....if you are still having trouble finding finance, then let me know...

[SoYank]

As weird as it sounds, you must prove that you don't need a loan in order to get a loan. Being sparce with credit accounts will certainly have a negative impact on your credit score.

As mentioned above you need to show a credit history and the only way to do that is to have credit in the form of cards or loans. The easiest and safest way to do this is to get a credit card with a low limit so you don't risk going overboard and then use it sparingly. When you have used it pay it off on time at the end of the month; your credit score isn't going to be affected just because you don't pay interest charges. The key is the on time bit.

[dxb335d]

I dont check my post much lol... Ive missed a bill before PMSL

[NFS]

Originally Posted by philg

I have just purchased my BMW half of the car was bought with savings and the other half was to be acquired by a loan.

Here goes 33 self employed, i have had 4 loans in my life all for cars never missed a payment and all have been settled early. Never had car finance or any type of credit. In my whole life i have been over drawn 3-4 time for very small amounts. I own half my house which is mortgaged. No accounts in debit, no loans at the moment, so only my house and bills. Do not own any credit card and never have. I have 1 store card i got, which i only did because i got money off the item, payed balance in full when statement came.

When i took out my first mortgage the guy at the bank said it had been one of the lowest credit scores he had seen. Anyway i have really just carried on life like this, if i want something i save up and buy.

This brings me on to the loan for my car, £6000, I have been offered 10% APR and then 20% by another, why can i not get the best rates IE 7.6%.

I spoke to my brothers girlfriend she does credit checks, and basically told me get store cards and credit cards to bump up my score but just keep them in the drawer at home.

Is this the way we live you need credit to get it, madness.

Anyone offer some advice.

Phil

Credit cards do make a difference, but since you already have a mortgage and are presumably paying it on time, you should really be OK.

As to the best rates, my credit score is bang on, but bloody sodding moneyback bank spent an hour interviewing me on the phone then offered me a loan at 2% above the advertised rate.

Couple of years ago, so it was something like 8% versus 6%. They refused to tell me why they wouldn't offer the best rate.

I felt conned - I wouldn't have bothered with them unless I thought I could get the 6%.

Best advise from me would be to try your bank. Provided you have run your current account well and are consistently in credit they will ordinarily lend you some money at a pretty decent rate. Maybe not as low as some of the headline rates, but 8.5% should be achievable. Bear in mind though that £6000 is a smallish loan, so they won't necessarily give you the best rates, unless you opt to pay it back quickly.

[SoYank]

The easiest thing for recurring bills is Direct Debit as long as you remain cognizant of your bank balance. Then you don't have to worry about misplacing a statement. Get overdraft protection for those unfortunate timing problems when you aren't able to put money in.

Consider direct deposit if it's available. With that you can even have a bit taken straight out and put aside in a separate account which you won't see on your regular account balance and, well, out of sight, out of mind.

People get into financial problems by not maintaining control and oversight over their money. Unfortunately we live in a culture of now, now, now and keep up with the Joneses.

[philg]

thanks for all the advice guys, i have applied for two credit cards and will probably get a b&q store card to, don't like the idea of this but if it helps me out in the future then hey.

As for the loan mothers come up trumps nice low apr rate , going to just pay her back monthly. It would break my heart to give the bank £1000 in interest on a £6000 loan.

Hopefully next time I'm buying my next car, all this credit crunch and good credit score should help.

Thanks again Phil

[3_toed_tree_sloth]

Another thing, do not pay loans off early, banks don't like it because they make less money and your credit rating will suffer as a consequence. People are generally not aware of this.

[mgarvey]

You can get advice on your credit rating by signing up to a service from Experian or similar. I have an account with CreditExpert (www.creditexpert.co.uk) which costs £50 per year but allows you to:

- check all records in your name, or with people associated with you like your spouse.

- check your payment history and official balance for everything you owe

- review every address and person associated with you

- check any CCJs or anything else held against you

- find out who is running credit scores against you and why

- get your credit rating (costs another £5 each time you do it)

The service also alerts you whenever anything changes on your accounts or someone runs a search against you - so you have some modicum of protection against fraud or identity theft.

I swear by it and have solved credit problems before when being refused credit - in my case it has generally been down to system or user error.

In short, if there is a problem with your credit score it should give you an idea of where to look.

[tisme]

I get a credit report from both Equifax and experian every two years - costs £2 for each.

I like Virgin, they have given me over £14k as a 16 month interest free advance on a credit card with a 2.98% - that is 2.23% APR.

Cash goes in bank account (I have offset mortgage) so I save 6.5% and pay 2.2%, ie a saving of 4% on 14k over 16 months = £750 saved over the period.

At the end of 16 months, I repay the loan from the bank account having made minimum payments during the period via direct debit. Oh, and if you do this, never use the card for spending, use an Amex at 5% cashback for 3 months or a Citi at 1% cashback perpetually. This is how I am funding my Facelift.

And, I'm doing this with more than one card - Abbey gives money away fee and interest free

Money is out there for free

[scooba0010]

Iteresting . while recently making a purchase in Laura Ashley we was offered a store card No thanks ! but you receive 25% of your purchase today sir ,well now im interested £500 off great ok i said ill take one then.The girl phones through my details after what seams ages i get declined .How weird i was thinking i must have a reasonable credit score ,no mortgage,store cards ,hp,loans.

Now i notice every body saying credit cards is the way to get noticed and get your credit rating up in my opinion that isnt enough.I have a lloyds tsb card and my wife a virgin card we clear both in full every month so to avoid interest.I now belive you are checked and if they cant screw you for some money they dont want you .

I was told by a mate in the buisness make sure you always ask for a secured loan against your property that way you do get a better rate of interest

[tisme]

Originally Posted by scooba0010

I was told by a mate in the buisness make sure you always ask for a secured loan against your property that way you do get a better rate of interest

Wise words provided zero risk that you cannot pay off the loan.

[booforty]

Originally Posted by tisme

use an Amex at 5% cashback for 3 months or a Citi at 1% cashback perpetually. This is how I am funding my Facelift.

Just a nose job or the full Pete Burns look?

[willhollin]

Originally Posted by booforty

Just a nose job or the full Pete Burns look?

[tisme]

Originally Posted by booforty

Just a nose job or the full Pete Burns look?

I'm not into nose jobs could think of others I may be though