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LoraLoo Apr 13th, 2016 07:28 AM

Credit scoring
 
Just wondering if anyone knew which would most go in our favour?
Currently our credit score is 4.5/5 on noodle, and 'Good' on experian.

The only thing we have on finance is the car which is paid weekly. We have less than 2000 owing.

I also have a Next account and I think I owe 800 and my limit is 5000.

The payments on these are always made on time and I always pay more than the minimum on my Next.

Hubby keeps mentioning just paying the car off with our savings. We're hoping to change mortgage companies soon. Will paying the car off lower our credit score? I read companies like you to have a bit of credit/finance so they can see that tick each week when you've paid on time.

I'm also worried that if we decided to refinance and get a new car (which we probably won't just yet anyways) that this would also go against the mortgage.

Does anyone know for those couple of things? X

Dinah93 Apr 15th, 2016 14:41 PM

From a mortgage perspective they like a good credit score, but having high fixed monthly outgoings to a lot of credit sources is a big negative. Their ideal borrower has a credit card paid in full each month, showing they owe nothing but always repay on time.

RaspberryK Apr 16th, 2016 07:06 AM

I would get rid of the store card debt, don't apply any for anything else or switch accounts. Pay car insurances in full rather than monthly.
I doubt that paying off a loan would have a negative impact, how long till the end of the term of the loan?
X

LoraLoo Apr 16th, 2016 08:09 AM

We have around 17 months left on the car finance and less than 2k outstanding x

RaspberryK Apr 16th, 2016 08:47 AM

Might be best to ask an independent mortgage advisor as they will be able to advise
If you have enough savings then it's usually best to pay off any debts as the debt will be costing more than any interest earned on savings.
X

Pearls18 Apr 21st, 2016 14:18 PM

Go to an advisor, I would think if you're remortgaging that that's very different to being a first time buyer, you'll have proven yourself as low risk I would guess? I would prioritise the next account though.

LoraLoo Apr 21st, 2016 16:24 PM

Yeah and we have a fair bit if equity in the house too. I just get really nervous at the prospect of applying for a new mortgage- it's 9 years since we last did it and I know the criteria is so much tougher these days.

Pearls18 Apr 21st, 2016 16:51 PM

I'm sure it's more for first time buyers tbh, but the main thing nowadays is affordability, try and evaluate all your outgoings and see what you can reduce or erradicate altogether. I wouldn't think your credit score would be too much of a concern, but just generally your outgoings vs ingoings. We're going through the process for the first time ATM, so worried :/


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