Will paying off a credit card in full raise my credit score?

[makingmiracles]

Curious as what to do really, need to take out a loan to buy a bigger car and a few baby bits, got 2500 saved towards but need to take out loan of about 6k to get a low ish milage car and few bits we need for new addition.
Looking at credit report our score is 842/ fair which I'm not sure how good that is for the like hood of getting a unsecured loan?
The bad factors bring the report down are a missed (£7!) payment on a credit card before Xmas which is fully paid off and something that says " highest revolving credit account is 1k or less...what does this mean, does it mean if the credit limit for that account was higher it would raise the score?

Are there any other ways to increase the score before applying for a loan, we're only 39 points away from "good score" ??

Also I we were to pay off the credit card(£600 balance) with the the money we've saved, how long would it take for the credit score to change to relent this?

Any tips gratefully received!

short answer is yes. Another trick is to take out a loan you don't actually need and then pay it off ASAP. Your credit rating is merely an indication of your ability to borrow money and then pay it back on time.

Not necessarily just that though:

1. Have credit in the first place (DSis did not and wonderd why she couldn't get a loan!)

1. Showing you can manage debt increases another part of the measure... so I get a contract for phone, 0% interest for furniture, etc.

1. DDs and SOs... in a joint named account. The bills are in my name, usually (DH works away a lot) but the joint account is good for both of us.

1. 3. Multiple cards with liitle limits on them annoy them too. One card used regularly pleases them more.

1. That revolving credit: it is the difference between how much credit you have and how much you use regualry... about 30% makes them happy - so if you use £1K a month you'd need a 3K limit to keep them happy

1. If you need to apply for credit, do it in one hit. One or two short time periods indicate you are being svvy. Lots of them over a year indicates you are desperate, apparently. I think the credit check stays on your credit history for about 50 days, maximum.

I went through all of this with DSis 2 years ago. Now she is obssessed with her credit score and checks it, cleans it every month. It took ages for me to explain that in writng to get old debts/contracts deleted befor ethey fall off naturally, etc makes her look more like a bad risk than just leaving it all there did.

So don't get crried away .

Oh... all that form a friend whose job it is to check credit ratings

Another trick is to take out a loan you don't actually need and then pay it off ASAP. Good idea, but don't pay it of early, just on time, every time!

Paying something off early is unusual - why would you change the contract? WHat are you trying to achieve/avoid? So that too causes a dip in your rating!

That's what I meant, OurBlanche, take one out for the shortest possible term, sorry for the confusion.

Hmm that's interesting, I've got a catologue with a 500 limit, of which 230 is used on it, it used to keep increasing and went up to something like 3500, would I have been better to leave it at a higher limit!? Only ever use it for emergencies or expensive purchases eg last purchase was a de humidifier, never for clothes or anything.

We both need to get new phone contracts as they ran out last oct and just haven't got round to it, dp keeps putting it off saying we need to concentrate on the car situation first and I had thought maybe applying for them after getting a loan/ using loan to buy two handsets outright would be better but do you think we ought to look at new phone contracts first then before loan application as it may improve score? Got leeway on loan application for car till late July/aug time as wont need to go out all together till then so can manage with the 5 seater, will that be enough time to improve our rating do you think?

I've no idea what my credit score is and frankly do not care as its all just "computer says no" algorithms
and every time it has said no I've phoned them, explained why the algorithm is wrong and sorted it

worry more about sorting your true finances than your credit score

phone contracts are an UTTER con
payg and blagging wifi will save you a fortune

Someone will give you a loan. It's just the interest rate will be dependent on your credit.

You want to borrow £6k. How long do you want the loan for? What's yours income?

phone contracts are an UTTER con

Not always... I run 2 businesses from a £10/month contract. PAYG would cost me more, a lot more. I use it daily, for calls, texts and 2 or 3 apps that I run my business in.

But as most of the bundles I have seen are £40/month ish it might just be that I am unusual in the contract I have!

Oh FUCK, applied for the loan, which by using moneysavingexperts soft search facility told us 80% chance of being accepted and just had the decision through which says no, I don't understand how they come to that conclusion given a fairly good credit score!?

Do they tell you why when they refuse you a loan?

Pants pants pants, not good.

They don't have to tell you their reasons.

You need to have borrowed something to get a credit score, they want to see that you keep to a schedule. I just have one card that i pay off every month now, so my score is probably rubbish despite having no mortgage (I am Old). So it's worth, as suggested, using a credit card and meticulously paying at least the minimum - do a DD so you never forget.

Cars don't need to cost £6k, it's partly luck (and judgement) to get a good one.