Reply to: Still on bench and might have to sleep on it as well

[lilelvis2000]

This thread seems to have slipped into Legal whilst still being in general. And rational answers are being supplied!

[Power Mortgages Ltd]

OK thanks for info (though not sure how earnings appears on credit record?) I will check with my lender.

Earnings wouldn't show on your credit report but would be considered as part of the application.

Essentially when you apply for credit there are usually two systems being used to assess your application. The first is the actual credit check where they will use a provider like Experian who will provide them with a credit score for you and detail if you have any 'adverse' credit like missed payments, CCJ's defaults etc.

The other system will be the lender's application system whereby they will assess things like how long you have lived at your address, what your income is, how long you have been in your job etc.

Most applications work on a point scoring system so if you said that in order to get an application agreed you need a score of 75/100 then quite often (using random figures) it will work something like this:

Poor credit score = 0 points
Medium credit score = 50 points
Good credit score = 70 points

The above is all information that Experian would provide, the below are things the lenders application would pick up.

Lived at address over 3 years = 10 points
Worked in current position over 3 years = 10 points
Earn over £x per annum = 10 points.

There are obviously a lot more factors than the ones I have mentioned above and it is no way near as simple as that but it works on the same principle, just in a lot more detail.

So you can see that if you have a poor credit score even if you score very well on the lenders application you are still likely to be declined. Likewise even if you have a good credit score, depending on the weighting of the points assessed in the lenders application you could still be declined.

If you credit score is medium you normally need to score quite well on the lender points to be agreed.

[MPwannadecentincome]

Correct Mary Poppins.

Things like how long you have lived at your current address, how many addresses you have had in the last 3 years, your residential status (owner, renting, living with family etc), if you are on the electoral roll, your employment type, your earnings etc.

Whilst lenders who use credit scoring will obviously refer to the likes of Experian to carry out the credit check, it is possible to be declined for a certain type of credit due to the parameters set out by that particular lenders criteria which can have nothing to do with how you run/manage your credit.

Lack of credit will also lead to a low score as Experian (or other agencies) dont have a lot to go by to judge how you manage credit. Likewise, a high level of credit will reduce your score and even being close to the limit on credit cards reduces your score. Multiple credit checks will reduce your score too.

Going on a payment holiday will not affect your credit in any form though so the outcome of an application would be the same, regardless of whether you are on a payment holiday or not.

OK thanks for info (though not sure how earnings appears on credit record?) I will check with my lender.

[Power Mortgages Ltd]

I think this explanation is over simplified. I do not have a a high credit score now even though I have no late or missed payments, no CCJs and no defaults - I have had credit card applications declined.

Your credit rating can be dependant on other stuff, too. Google is your friend.

Correct Mary Poppins.

Things like how long you have lived at your current address, how many addresses you have had in the last 3 years, your residential status (owner, renting, living with family etc), if you are on the electoral roll, your employment type, your earnings etc.

Whilst lenders who use credit scoring will obviously refer to the likes of Experian to carry out the credit check, it is possible to be declined for a certain type of credit due to the parameters set out by that particular lenders criteria which can have nothing to do with how you run/manage your credit.

Lack of credit will also lead to a low score as Experian (or other agencies) dont have a lot to go by to judge how you manage credit. Likewise, a high level of credit will reduce your score and even being close to the limit on credit cards reduces your score. Multiple credit checks will reduce your score too.

Going on a payment holiday will not affect your credit in any form though so the outcome of an application would be the same, regardless of whether you are on a payment holiday or not.

[MaryPoppins]

I think this explanation is over simplified. I do not have a a high credit score now even though I have no late or missed payments, no CCJs and no defaults - I have had credit card applications declined.

Your credit rating can be dependant on other stuff, too. Google is your friend.

[MPwannadecentincome]

It will vary from lender to lender in terms of how they report the information to your credit file. Some will show the entry (instead of a green '0' which indicates there are no missed/late payments) as 0 indicating it has been paid, others will show the entry as U which basically means they do not have the information. They will definitely not register it as a '1' (1 missed payment) though as this would negatively affect your credit file.

A payment holiday will not reduce your credit score, nor adversely affect your credit file.

When someone carries out a credit check on you they seldom actually look at your credit file and the entries registered on it. It is all done electronically and based upon the system they use to credit check you looking at your 'score' as well as looking to see if there is anything like missed payments, CCJ's or defaults which could lead to a declined application for whatever you are applying for.

Hope that helps?

I think this explanation is over simplified. I do not have a a high credit score now even though I have no late or missed payments, no CCJs and no defaults - I have had credit card applications declined.

[Power Mortgages Ltd]

So if someone looks at my credit file during the payment holiday it will say that all payments are upto date?

It will vary from lender to lender in terms of how they report the information to your credit file. Some will show the entry (instead of a green '0' which indicates there are no missed/late payments) as 0 indicating it has been paid, others will show the entry as U which basically means they do not have the information. They will definitely not register it as a '1' (1 missed payment) though as this would negatively affect your credit file.

A payment holiday will not reduce your credit score, nor adversely affect your credit file.

When someone carries out a credit check on you they seldom actually look at your credit file and the entries registered on it. It is all done electronically and based upon the system they use to credit check you looking at your 'score' as well as looking to see if there is anything like missed payments, CCJ's or defaults which could lead to a declined application for whatever you are applying for.

Hope that helps?

[lilelvis2000]

There is some sort of metamorphosis that women undergo after the honeymoon.

Mine started her's during the honeymoon!

[MPwannadecentincome]

Never understood this obsession with paying off your mortgage. That leaves you with a massive illiquid asset consuming most if not all your IHT allowance ??? Then people end up selling to a dodgy company to free up cash ! WTF ?
I will be quite happy to have a huge mortgage outstanding to reduce the impact on my estate. It takes discipline but I would be much happier having an offset account containing any overpayments which I can use/move around later if needed.
I will be remortgaging soon and going interest only, offset by big chunk of cash which will be the fixed interest element of my overall asset allocation.

I had an offset mortgage once - I loved it. OH did not understand it and spent the money. Had to switch to "traditional" mortgage when we moved.

[MPwannadecentincome]

So this is what everyone is doing is it? Switching to interest only and taking a payment holiday. No wonder the economy is looking better, zero mortgage payments whilst everyone stocks up on bigger TV's and more tattoos.

Long story for me - I was on interest only to start with as that was the only way at the time to finance a house move whilst trying to pacify OH a few years ago. I should have walked out the door at the time as she was threatening to divorce me if I didn't get finance for the house move. Not an easy decision at the time with 3 kids the youngest at the time was only 1 yr old.

Oh well live and learn.

[MPwannadecentincome]

A payment holiday shouldnt affect your credit record as it is an agreed facility that banks offer as part of their mortgage.

So if someone looks at my credit file during the payment holiday it will say that all payments are upto date?

[doodab]

Only what it said on the advert.

Wipe clean? Puncture resistant?

[TheFaQQer]

Aye.

Well, of course, I had it tough.

She used to thrash me to sleep at night wi' a broken bottle if I were lucky.

[DimPrawn]

Feck me.
No one can really know another person but did you lot know anything about the woman you married?

Only what it said on the advert.

[doodab]

Feck me.
No one can really know another person but did you lot know anything about the woman you married?

Some people say love is blind, but really it's just incredibly stupid.