Credit Score Has Increased but still cant get credit!!

[Lucky4Seven]

Earlier this week, my credit score with Experian was 118.

Today, it shot up by 422 to 540 due to the fact that I had 2 accounts via Capital One which were closed and settled.

However a default was issued on the 12th June by NewDay Ltd, which I am trying to sort out as the lender has agreed that they will not chase me for payment so I have asked if they would mark the default as either closed or partially settled.

Anyway, I am asking that as my credit score has shot up by 422 points, I am still being declined credit.

Apart from the NewDay default which is being sorted out, that is the only marker on my credit file.

I cannot understand why I am being declined credit , even now my score has vastly improved.

I have lived at my current address for 5 years, been at my bank 5 years, I'm on the electrol roll, I have good income of £13000 a year in benefits. I put that I am retired on application, but where they ask what your residential status is I have to put private tenant as there is never an option for living with partner.

Any advice?

[Amethyst]

Credit applications aren't really based on the 'score' on the CRA's - they're more for guidance - the actual lenders will look at a lot of things, including if you've made lots of recent applications, defaults, settled defaults etc. Also income expenditure etc. It will vary by lender too.

540 is still pretty dire for Experian I'm afraid - experian scores are out of 999 so you're still, even on 500, on bottom end of Poor.

Have you checked your other credit files - Equifax and Callcredit(transunion) - different lenders use different ones - Equifax fee version is Clearscore - and Callcredit is Noddle.

With such recent debt that has been settled/written off and the NewDay issue still live is it a good idea to be taking on more credit ? Can I ask what you require additional credit for ? There may be better options.

[Amethyst]

The Experian Credit Score runs from 0-999 and is based on your Experian Credit Report. It gives you an idea of how lenders view your Data Self. The higher your score, the greater your chance of getting the best credit deals.
Excellent
961 - 999
You should get the best credit cards, loans and mortgages (but there are no guarantees).
Good
881 - 960
You should get most credit cards, loans and mortgages but the very best deals may reject you.
Fair
721 - 880
You might get OK interest rates but your credit limits may not be very high.
Poor
561 - 720
You might be accepted for credit cards, loans and mortgages but they may have higher interest rates.
Very Poor
0 - 560
You’re more likely to be rejected for most credit cards, loans and mortgages that are available.

[Lucky4Seven]

The Financial Ombudsman Service are looking into NewDay to see why the defaulted on my account on the 12th June AFTER telling me in writing on the 14th May that they are no longer acting to seek the outstanding balance.

The FOS are going to seek that NewDay change the status of the default to either closed or satisfied as a reflecgtion that they are no longer chasing me for money so the status of the account needs to be changed to reflect that.

I'm only wanting credit to increase my credit rating, but I am now going to hold off and to see how the FOS can get NewDay to change the status of the default.

Can I ask, if they agree to mark it as close or satisfied, should that make my score go up even more?

Thanks x

[Amethyst]

It should start improving, I'm waiting for a dispute default to be removed myself ATM to be shifted to closed/settled so I'll let you know if it affects the score.

Good to hear the FOS are looking at 'not going to chase anymore' being moved to closed/settled ( as opposed to partial settlements in full and final being moved etc) - be interesting to see what they come back with.

If you get something like a credit card to help you build your credit, try and get one where you can opt out of credit limit increases, and make sure you pay the full balance each month. Else everything can easily go south again.

[Lucky4Seven]

It should start improving, I'm waiting for a dispute default to be removed myself ATM to be shifted to closed/settled so I'll let you know if it affects the score.

Good to hear the FOS are looking at 'not going to chase anymore' being moved to closed/settled ( as opposed to partial settlements in full and final being moved etc) - be interesting to see what they come back with.

If you get something like a credit card to help you build your credit, try and get one where you can opt out of credit limit increases, and make sure you pay the full balance each month. Else everything can easily go south again.

Since my credit score increased, I have tried for a credit card but cannot get one I keep being declined.