How can I improve my credit rating?

LegacyUser

Ok so last year I missed a lot of repayments on personal loans and credit card. The bank then moved my loans to a debt recovery agency.
Now I have a new job and few months back I set up a repayment plan with the agency and all is going well since.

However now my credit rating is awful. Anything I apply for like credit card or personal loan or interest free store credit is all refused because of the history on my credit report. Even when I applied for an overdraft my bank wouldnt give me anything.

How long does it take for creditors to start trusting me again?
How can I show that I can repay if nobody will give me credit?

Leo12

Get a copy of your credit history from the Irish Credit Bureau, you can do it online and think it's about €6 or €7. This gives you a copy of what all your potential creditors will see. In the meantime did the bank or any other institutions explain their criteria to you when refused a loan or credit? Give them a ring back or email and ask when you would be acceptable. It might be when you have fully finished with the debt recovery agency. In the meantime stash away some money with a credit union, everyone can save a little bit each week or month and it does really add up. Potential creditors want to see a good steady repayment history, how long did you have to go before you are finished with the debt recovery agency? My tuppence worth, don't get a store card or credit card because they fuel impulse buys and a loan should only be used in an emergency. Try and save up if you possibly can for any treats for yourself, you will rethink your purchase if paying by cash.

Stavro Mueller

According to the Irish Credit Bureau's website, they keep records for 5 years. http://www.icb.ie/credit_rating.php.

Given your poor track record last year, you'd be doing well to get any sort of loan/overdraft in the short term unfortunately. Without knowing more about your circumstances, I'd be asking why are you looking for an overdraft or another loan seeing as you ran into such problems last time? A banker would look at this quite coldly and think you were looking for more rope to hang yourself with. The only advice I can give you is to build up a good savings record. If you can afford it, set up a savings account. Then set up a direct debit and pay a fixed amount into it each month. Try not to dip into this account. That will show an ability to live without a fixed sum of money each month.

If you want a credit card for online shopping, either get a Visa Debit card or one of those "pay as you go" ones such as O2 money. That way you can't run up any debts.

I second the advice of the poster above me regarding the Credit Union. Set up an account with them. I think some Credit Unions accept direct debits from bank accounts. Maybe instead of setting up a savings account in the bank, you could have one with the Credit Union instead.

Meathlass

I was listening to Jill ? (financial adviser) speaking about this on the radio the other day and she advised people in your situation not to apply for loans/cards etc unless you're sure you're going to get them. She said all the refusals for credit will be another black mark on your credit history. Instead have a word with the lending institute and explain the situation and ask them if they think it's feasible before you put in an offical application.

Definitely set up a credit union account. I have one for years and have a standing order every week going into a savings account with them.