Credit report - any experts in the house?

Big Chris · 1 Jul 2015 at 12:41

I signed up to Noddle a few months ago, and I had a 5/5 credit rating which was nice. I've since signed in and this has gone down to 3/5 for no obvious reason.

For the last 10+ years I've, as far as I'm aware, had a spotless credit history. I have various direct debits going out of my account for household bills, mobile phone, rent etc and have not missed a single one in 10 years. I've had various credit cards, not missed a payment or ever incurred any charges or interest of any kind on any of them. I currently have a credit card which I use day-to-day for shopping etc and this is paid in full weekly. I have no loans, no car finance or anything else of that sort. I'm also on the electoral register.

The last few credit cards I've applied for I've been instantly accepted and been given fairly decent limits (approx £6k) without asking so assumed my rating was healthy. Now however I've dropped two points from 5/5 to 3/5. The only thing I can think of is that I recently got a 0% purchases credit card which I bought a new bike on (balance of approx £2k on the card). I've not missed a payment on this and am putting 3x the minimum payment on it each month, still has 12+ months of interest free left on it.

Could this be what's dropped my rating? I was under the impression that paying a balance off regularly had a positive impact on your credit rating? So if not this new credit card then I can't think what else :confused:

. I've sent Noddle an email but since I'm on a freebie they'll probs tell me I have to pay them to find out the details.

Zogger · 1 Jul 2015 at 12:43

Credit rating / score is an arbitrary number... maybe Noddle just drop it down because they consider an recent increase in the number of credit cards to be a change in circumstances

Moley · 1 Jul 2015 at 12:45

Your rating has dropped because the amount of available credit on you cards has dropped by you making the purchase.

Zefan · 1 Jul 2015 at 12:46

Noddle isn't all that great. Also, take the "score" they give you with a mountain of salt.

If you're really worried, apply for your credit report from experian (my favourite) and/or equifax, I believe you can do so for a under a fiver each time. Alternatively of you just wanted to check a single time, sign up to those sites for the free 1 month trial.

I imagine your "score" has decreased because of the way you have increased the amount of credit in your name. This may well look good later on, but for now it shows that at least some of your ability to repay other sources of credit is diminished to some degree.

Freakbro · 1 Jul 2015 at 12:56

Mine fluctuates on Noddle quite frequently and I was 2/5 on Noddle while at the same time 969/1000 on Experian, which I never understood.

Also, many things can affect your score that aren't negative. I don't think Noddle like the fact I have about 7 credit cards (due to many 0% rate balance transfers over the years) with ~30k available credit - even though I only have ~£300 owing

So amount of available credit can lower your score also say you only had £1000 limit and was using £900 that wouldn't look good even if your paying it off fine, as it shows your credit hungry (or so I've been told)

Big Chris · 1 Jul 2015 at 12:57

Moley said:
Your rating has dropped because the amount of available credit on you cards has dropped by you making the purchase.

Zefan said:
I imagine your "score" has decreased because of the way you have increased the amount of credit in your name. This may well look good later on, but for now it shows that at least some of your ability to repay other sources of credit is diminished to some degree.

Makes sense I guess. Do they also take savings into consideration? I have enough to pay the card off three times over if I wanted so although I have the £2k credit against my name, I'm not reliant on it.

Big Chris · 1 Jul 2015 at 12:59

Freakbro said:
Mine fluctuates on Noddle quite frequently and I was 2/5 on Noddle while at the same time 969/1000 on Experian, which I never understood.

Also, many things can affect your score that aren't negative. I don't think Noddle like the fact I have about 7 credit cards (due to many 0% rate balance transfers over the years) with ~30k available credit - even though I only have ~£300 owing

So amount of available credit can lower your score also say you only had £1000 limit and was using £900 that wouldn't look good even if your paying it off fine, as it shows your credit hungry (or so I've been told)

Interesting... seems as though it's a bit of a dark art then trying to adhere to the hidden points system they use to mark people!

Haggisman · 1 Jul 2015 at 12:59

Moley said:
Your rating has dropped because the amount of available credit on you cards has dropped by you making the purchase.

Not quite, I would imagine it's because his utilisation of available credit has increased.

e.g. before he had £10k* available credit, £0 used = 0% used

Now he has £12k* available credit, £2k used = 16.67% used

* numbers pulled out of thin air

A recent application will probably have a detrimental effect on your score as well, although for just one application, I would imagine that effect to be pretty negligible.

However, as Zefan has said, don't put too much faith in Noddle's score, for some reason I have 1/5 with them, even though my score with both Experian and Equifax is "Good"

Big Chris said:
Interesting... seems as though it's a bit of a dark art then trying to adhere to the hidden points system they use to mark people!

Well, ultimately, your credit "score" is only 1 part of a much bigger picture - what one lender may see as a positive factor, another may see as a negative.

Zogger · 1 Jul 2015 at 12:59

Big Chris said:
Makes sense I guess. Do they also take savings into consideration? I have enough to pay the card off three times over if I wanted so although I have the £2k credit against my name, I'm not reliant on it.

They don't have access to your savings balance

Zogger · 1 Jul 2015 at 13:01

Big Chris said:
Interesting... seems as though it's a bit of a dark art then trying to adhere to the hidden points system they use to mark people!

As above though, a credit score in itself is generally meaningless so learning the "dark art" is not necessary as long as you keep everything in order and avoid rocking the boat if you have something big coming up.. every credit application generally has unique criteria. I have had a perfect score on multiple sites and been rejected for a pretty straightforward credit card, and at one point had 3/5 on noddle and accepted for a reasonably large amount.

IMO "credit boosting" is only really relevant to people who have a bad history (my opinion may be incorrect)

robfosters · 1 Jul 2015 at 13:03

Opening up new credit accounts decreases your rating.

Also, average length of accounts matter as well. Opening up a new credit account will have dropped your account average age, which will also decrease rating. Experian recommend an average account age of at least 30 months. Plus you will also have had a search done on your record, which is another possibl hit. It's probably a combination of all those.

Haggisman · 1 Jul 2015 at 13:11

If you sign up to the Experian trial, they have a section which highlights the "negatives" on your profile, and gives tips on how to improve them.

Broken Hope · 1 Jul 2015 at 13:27

The score is useless, creditors don't see it and score you using their own system.

Just use the likes of noddle to ensure the data on your report is accurate and ignore the scores completely.

tidusjar · 1 Jul 2015 at 13:38

Broken Hope said:
The score is useless, creditors don't see it and score you using their own system.

Just use the likes of noddle to ensure the data on your report is accurate and ignore the scores completely.

But if all of the `external` systems are reporting you have a good or bad rating then the creditors is going to be similar, since at the end of the day, they are looking at the same data but with different scoring algorithms.

Jono · 1 Jul 2015 at 13:46

Experian doesn't seem very up to date today. It knew I had a new CC, so had an extra chunk of credit about 2 weeks ago... and marked that as a negative.
I transferred the balance of another card to the new one and paid off a chunk of it... it's still showing as the full amount on the original card.
Current balance of original card is actually £0.

Haggisman · 1 Jul 2015 at 13:53

tidusjar said:
But if all of the `external` systems are reporting you have a good or bad rating then the creditors is going to be similar, since at the end of the day, they are looking at the same data but with different scoring algorithms.

It still depends on what the creditor is looking for though.

One lender might see someone paying off only the minimum on a credit card as someone struggling to meet their commitments = higher risk, so will see that as a negative factor.

Another lender might see someone paying off only the minimum on a credit card as more profit due to paying more interest, and so see that as a positive factor.

Zogger · 1 Jul 2015 at 14:04

Jono said:
Experian doesn't seem very up to date today. It knew I had a new CC, so had an extra chunk of credit about 2 weeks ago... and marked that as a negative.
I transferred the balance of another card to the new one and paid off a chunk of it... it's still showing as the full amount on the original card.
Current balance of original card is actually £0.

I believe the lenders only report balances on a monthly basis

rubberduck · 1 Jul 2015 at 17:41

I believe my mortgage lender (Halifax) used equifax to determine my credit history/score.

Ace Modder · 1 Jul 2015 at 18:10

my credit score with creditexpert.co.uk is 906 out of 999, but noddle says I'm 1/5

So don't worry too much about noddle.

norm · 1 Jul 2015 at 21:54

Ace Modder said:
my credit score with creditexpert.co.uk is 906 out of 999, but noddle says I'm 1/5

So don't worry too much about noddle.

There are three main credit reference agencies who each hold a different set of data. If there's something amiss on your Noddle report it could be Experian don't know about it.