Do "guaranteed" credit cards help your credit score
 

Unfortunatley in my younger years, I was a bit naughty and messed up my credit rating. Trying to sort now, I have been accepted on one of these high risk type credit cards.

Now will this help my cause if I keep a very small balance on it and pay it by direct debit, say £100 or so.

Before anyone says anything Im aware they will charge the Earth in interest if I max it out.

Anything on your credit record will stay there for a number of years. Taking a 'sub prime' credit card isn't going to wipe out the past or a lenders view of risk.
It's a matter of time and slowly rebuilding, of course if you're smart you can take the proverbial and come out of it smelling of roses. Probably a little late for you now.

The best way to repair your credit rating will be to conistantly pay off your debt.

Say ther eis a £200 limit on your new card, put all your petrol on it for example and then pay it off in full every month.

You'll pay no interest and it will have apositive effect on your credit rating.


The other thing you can do is contact experion et al and make sure there aren't any debts on your record that shouldn't be, or ones that show as being unsettled that you have paid off.

There is no such thing as 'credit repair'. It's a misnomer bandied around by conmen who want to make money out of bad debt ie there's no point kidding yourself taking out a credit card and paying it off every month is going to mitigate against thousands of pounds of debt accrued relatively recently elsewhere.

Time is the only healer and paying off your debts (or being more imaginative).

If you are clear of debt, with previous defaults, etc.. having a new credit card can help, but as NACRO says it doesn't repair your record as he rightly says there is no such thing as credit repair.. If your last 'activity' i.e the last time you had bad debt was within the last 6 years it will still be visible to people doing credit searches.

However.. if it was a couple of years ago and you can show that you're managing to handle credit with a perhaps a new card, and possibly even an overdraft with your bank, even a mobile on a contracted tariff (all of which register with credit reference agencies) over time it may sway other lenders to offer credit as it shows a level of responsibility to potential lenders. Remember start small.. show an active and well managed recent credit history and you can make yourself a better prosepct, where past indiscretions are sometimes overlooked.

You might be expected to pay higher rates of interest than those who haven't had problems however...

I should add... if you've still got craploads of debt... it'll make no difference whatsoever...

I ws in the same boat, 3 years ago i got a credit report from experian, and there were seven things on it, most of which were at least 3 years old.

After phoning the companies involved, and lying a bit, five of the companies waved the payments to them,and sent letters out to that effect!, one company reduced the bill by 50%, then sent out a letter of settlement, and one im still working on!

I got another report 3 months ago, and there is only one thing on it, everything else has been wiped off!

So when this one thing is sorted, the only thing on there are things i pay off monthly, such a mobile bill!

And i reckon my credit is getting better, cos i get letters begging me to take a loan from prime lenders now, not sub prime!

Don't forget there is more than one credit reference agency, and what might be on your records with one may not necessarily be true with them all, the same for any omissions.... you should really check with Equifax as well to have just about everything covered. There is now a 3rd... but what Experian and Equifax don't have covered between them probably isn't worth knowing about.

If you have nothing on your credit history after only 3 years, you can consider yourself lucky... certainly the norm is a retention of 6 years after last activity, although the rules differ with bakcruptcy now I believe, so things might have changed since the last time I was involved with this kind of stuff. Either that or your creditors didn't register the bad debt with the agencies... (like I said check with both major CRA's).

cant be bothered to read any of the above, I used to work in the credit services team at egg in derby, so I can tell you with some certainty that if you were to get such a card, buy something on the card each month and pay it off in full each month after about 6 months, your credit score would have increased massively.

hth

james