Jonathan Hulse At J&M Green Mortgage Services Ltd

https://www.independent.co.uk/…/house-p rices-uk-property-ma…

With earlier and faster Bank of England rate rises predicted this year, it is increasingly important to review your current mortgage situation and when your next remortgage is due, and even more so if you are on your lender’s standard variable rate.
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Something that comes up a lot in my job is clients’ credit scores and the issues around how to maintain/improve them. Some of this may be obvious to some, but it may be helpful to others, so take what you want:
• Paying off your credit card in full is a more obvious way to improve your score, but don’t use it and repay it in full the same day. You need to wait until your credit card company bill you and then repay it. They want to see that you can take on a debt and repay it ...on their terms, not yours. • Avoid using credit cards to withdraw cash. They typically charge a higher rate of interest than for purchases and also can add a charge on top for each withdrawal. This tells lenders that you are willing to pay such charges just to get cash. It looks desperate and it lowers your credit score. • Don’t use price comparison sites if you can avoid it, especially prior to a mortgage application. Most credit checks can slightly lower your credit score but price comparison sites often result in several checks being ran all in the same day which significantly reduces your score. • Credit reference agencies note the percentage of available credit used. The closer to your limits you are, the worse it looks to potential lenders. Basically, don’t max your cards out. But then it gets tricky, as the opposite can have a detrimental effect: If you have several cards all with a nil balance, lenders see a potential risk in that you could obtain the mortgage then max all the cards out. If you have credit cards you don’t use anymore, close the account. • If you have any disputes with mobile phone bills or parking tickets while applying for a mortgage, pay them and dispute them later. I know the argument is that it’s harder to contest once you’ve paid it, but I’ve seen such things go unpaid and it results in a CCJ being applied to their credit report. • Don’t take payday loans. I know their interest rates should be warning enough, but some people take them out just a few days before payday and repay it in full without paying too much in interest. That doesn’t matter to lenders. Taking one indicates you have no other financial option but to accept a very, very high interest loan and it makes you look high risk. • Debits before credits. The banking system will instruct payments due to be made from your account to be taken before any credits due to be received that day. So don’t assume a Direct Debit will be paid just because your wages go in the same day, it can lead to a late/missed payment.
The content of the post is for information only & does not constitute financial advice.
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