Courtesy of Sainsbury’s Bank, a visual guide to credit scores.
If you’ve got a poor credit history as the result of missed payments, defaults or CCJs, you’ll have a tough job getting access to credit. Bad credit history cards are among the best places to start if you want to put things right.
Bad credit history cards can help you build (or rebuild) your credit rating by giving you the opportunity to prove that you can handle credit responsibly.
Every time you make the required monthly payment on time, your credit score will improve. If you continue to do this over a period of time, you’ll boost your chances of being accepted for a wider range of cheaper credit products in the future.
When they’re used efficiently, credit cards can prove to be a great source of cheap lending. Your opinion on this probably differs if your debts have mounted up and they’re costing a fortune in interest. This is where a balance transfer card comes in handy. Find out more about these credit cards below.
How Do These Cards Work?
Balance transfer cards are perfect for to helping people to reduce their debts. They allow you to move a balance from one or more existing cards onto a new card with a new provider.
Most balance transfer cards offer a 0% interest period, some of which last well over two years. Provided that you make your minimum payments on time, you’ll have this entire period to work on reducing your debts and it will cost you nothing in interest.
So, given that the average credit card rate was over 18% at the beginning of 2014, you could be saving over £180 a year for every £1,000 of debt.
Your credit report, also known as a credit file, is an important repository of information. It is routinely used by lenders to help decide whether to approve your application for a loan, credit card or mortgage. It may also help the potential lender determine the terms of your arrangement.
It is important to note that your credit report is not the definitive factor in whether you will be granted credit. Still, it is a useful indicator, and as a result, it is important to know exactly what might be in your credit report and exactly how you can access it.
Firstly, let’s be clear that not anyone can compile a credit report on you. In the UK, there are three registered credit reference agencies permitted to compile the relevant information and sell it to a potential lender for a fee. Most obviously, these include banks and building societies, but potential lenders might also include innocuous mail order companies and mobile phone companies who may also want reassurances that you will pay on time.
Credit reports can also be used for employment purposes when it comes to deciding on hiring or promotion. However, they cannot be used for this purpose without your prior, written permission.
- Save £100s by switching your credit card.
- In 3 easy steps, the new Beat My Card calculator compares your card against the market and lists up to 3 better cards.
- Win an iPad just by trying out the new feature!
As banks brace themselves for a fall-out from the crisis in Greece, the impact has been visible on personal finance products. Mortgage rates have hiked, while savings accounts and ISAs have plummeted. Hardly promising for a nation already in the grip of recession.
Credit cards stand out as the sole category of products that isn’t currently in meltdown. Which4U has come up with an ideal device that could help you make substantial savings on your credit card: the ‘Beat My Card’ credit card savings calculator.