Coming up to 6 years since the IVA...getting credit file in shape?

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thisusernameistaken
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by thisusernameistaken » Tue Jun 27, 2017 10:26 pm
I started my IVA journey around this time in 2011; the time really has flown by. After completing my IVA early in October 2015, I've been focusing on making sure I'm in a good position to be able to remortgage onto a more sensible rate when the defaults and IVA drop off in September this year. It's come round so fast! It seems like only a short while ago I was thinking, "...this will all drop off in just under two years' time...", now it's just a few months away...

Aside from the purchase of a newer car (saved for and bought outright! :D) I've continued to live a frugal and sensible a lifestyle. I learned my lesson from my IVA - I still budget and track outgoings, the only difference has been allowing myself a little more leeway with regards to things like meals out and such.

My mortgage is one of the legacy Northern Rock ones which was hived off to NRAM when the Government stepped in and subsequently shoved to 'Landmark Mortgages'. I have a mortgage of ~£148k outstanding on a property worth around £200k. It's interest-only at Landmark's SVR of 4.64% and I've been here 12 years, mortgage was 25 years. I spoke to Ryan at Zebra back in '15 when the IVA finished, mainly to make sure there wasn't something I could do immediately (realistically there wasn't) but I wanted to make sure I didn't assume I couldn't.

His advice was excellent and I've followed that to date; to save but don't pay capital off the mortgage just yet - it's better to keep it liquid and the amount of interest I'd save would probably be pretty negligible. As it is I've managed to have my savings in an account earning 5% interest into which I can pay up to £500/mo so it's gone a long way to offsetting anyway!

Right now I'm in the process of making sure the credit files are all in shape and wondered if there's anything I've missed? So far I've done the following:

1) Credit card - almost immediately after the IVA Capital One offered me a card. I took it and have used it for small amounts each month (mostly my fuel spend) which is paid off in full every month by Direct Debit. Capital One have increased my limit this month due to the way I've managed the card, rising from £1,500 to £2,000. Is this a good thing? I don't need the higher limit but if it is 'helpful' from a scoring perspective I'll leave it at £2k. If it could be detrimental, I'll ask them to reduce it back down.

2) No recent 'hard searches' - I had one from Nationwide in March but that's it. No more will be done between now and Oct/Nov.

3) All defaulted accounts align to the start date (or earlier) of my IVA.

4) I'm on the electoral roll (12 years).

I have around £5k in savings now and anticipate adding a further £2-3k to this between now and October which can be used to reduce the capital when remortgaging (if required). I'm hoping to be able to get onto a lower rate and will probably need to extend back up to the original 25 years (or more) but that's OK as it won't be the last time I remortgage and I can alter it down in future if I've reduced the capital faster etc.

Is there anything else I can or should be doing now for October...?
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Foggy
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by Foggy » Wed Jun 28, 2017 6:49 am
Great post and doing well :-)

The £2k credit limit is, strangely, a good thing at that level. According to the credit reference agencies, too small a limit (£1k or below) can actually reduce your score (however meaningless a "score" actually is). Too high a limit can also go against you as it is a potential liability ! A reasonable limit indicates a level of trust.

Looking good for the credit file clear up on the 6th anniversary. Make sure there are no Notices of Correction lodged as they do not drop off automatically. They will be removed on request.
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kallis3
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by kallis3 » Wed Jun 28, 2017 7:09 am
I agree with Foggy - excellent post and good to see you doing so well.
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Ryan
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by Ryan » Wed Jun 28, 2017 7:30 am
Keep on doing what you are doing to be honest.

Regards
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thisusernameistaken
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by thisusernameistaken » Wed Jun 28, 2017 8:22 pm
Thanks all. Ryan, I'll be in touch again in a few months' time...!
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Ryan
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by Ryan » Thu Jun 29, 2017 7:14 am
Look forward to hearing from you!
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Shaun Vickery
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by Shaun Vickery » Thu Jun 29, 2017 1:53 pm
This all amounts to good preparation and I'm sure Ryan will be able to help. It's certainly worth looking at given the rate you are currently paying and also arguably a good time to consider a fixed rate. There's no issue with an increase on your credit card limit as long as you keep paying it off. Good luck with it.
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thisusernameistaken
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by thisusernameistaken » Mon Sep 25, 2017 9:32 pm
B****r me, time flies...!

The defaults have all gone, the IVA has come off and the credit files are scrubbing up beautifully:

Image

I don't think I've ever had a perfect score before! My Equifax one looks similar and I'll be checking Noddle when it updates in a couple of weeks' time.

Have had two valuations on the flat in the last week and another this weekend in order to get a realistic average figure. I'm actually beginning to think I may even be able to do what I've been wanting to for years and move into a 2-bed place - I'd love for my mum to have somewhere proper to sleep when she comes to visit.

To all those still working their way through their IVAs: keep going! There is light at the end of the tunnel and it's worth it. :D You'll get there!
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Waitingforship
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by Waitingforship » Mon Sep 25, 2017 9:55 pm
Awesome job mate. That’s more than inspiring. Really well done and good luck on the next leg of your journey. :lol:
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thisusernameistaken
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by thisusernameistaken » Mon Sep 25, 2017 9:57 pm
Thanks Waitingforship! It felt a long way away at times and the IVA was often tough. I'm glad I stuck it out as I'm now able to look to the future without being held back by my historical debt.
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Foggy
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by Foggy » Tue Sep 26, 2017 7:06 am
The old scores will still wobble a bit ( in both directions) .... just keep the records clean and healthy and you will be on the up :-) Well done.

BTW -- I have had to slightly amend the language (tender ears and all that).
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kallis3
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by kallis3 » Tue Sep 26, 2017 12:32 pm
Well done on getting to the finish line and getting your finances in order again. All the best for the future.
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thisusernameistaken
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by thisusernameistaken » Tue Sep 26, 2017 12:37 pm
Thanks Kallis and Foggy!
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