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  1. #1
    Join Date
    Aug 2013
    Posts
    1,509

    Default Affect of credit cards on credit scores?

    I am interested in feedback on the following:

    1. Veda uses a credit scoring system up to 1,000 points where ~600+ is in the green. FICO scores go up to 850 points. I'm assuming based on the more conservative banking world here that after a certain score point, it may be quite difficult to get higher?

    What is the normal range of green scores here?

    2. Although getting a credit card costs a few points upfront, with FICO it can actually add a big chunk of points once it starts being used within it's limit. Is this the same here?

    3. What is the ideal credit card utilisation level (ie: percentage of total credit limit)?

    4. Are New Zealand banks actively reporting to Veda etc?

    5. If they are - is this reported at balance (statement) date or after due date?
    Last edited by PTWhatAGreatForum; 29-09-2016 at 11:40 AM.

  2. #2

    Default

    I know that banks look at your limit when assessing CC's but I don't use one so can't advise beyond that.
    Free online Property Investment Course from iFindProperty, a residential investment property agency.

  3. #3
    Join Date
    Apr 2016
    Posts
    2,343

    Default

    US system is quite different Michael as you may know. We help our clients build credit ratings in the USA and it's just a big game really. Mine is 830. You just have to know how to play their game. NZ is much more "real" I think being smaller and more computerised.

  4. #4
    Join Date
    Aug 2013
    Posts
    1,509

    Default

    The last credit check I got a copy of (April this year) showed a score in the green zone but I think there is room for it to go a bit higher and I am trying to work out how to do this. I have no recent credit beyond normal monthly accounts (none of which apparently ongoing-reported anyway) so I applied and was approved for a credit card with my bank.

    I'm hoping by doing this to increase my credit score and give any future lending a bit more boost then simply just good account history and no "adverse" information.

    Failing that, I get pretty well rewarded as it is a "Platinum" card.
    Last edited by PTWhatAGreatForum; 29-09-2016 at 12:11 PM.

  5. #5
    Join Date
    Feb 2006
    Posts
    213

    Default

    Majority of NZ credit scores are based solely on 'negative' credit information (adverse events such as defaults, judgements, collections, along with details of previous enquiries). This compares with 'comprehensive' credit information (including details such as is your credit card up to date) that form a big part of US credit scores. Comprehensive credit reporting is only in its infancy in NZ (access is restricted to utilities and registered credit providers on a 'reciprocal' basis - i.e. you can only access the comprehensive part if you also provide your data to that credit bureau). To further complicate it there are three credit bureaus in NZ and not every bank or utility list their data with all or the same bureau (if at all).

    Upshot of this is you are basically wasting your time trying to influence your credit score by managing your credit card spend. Aside from the initial enquiry when you applied for your credit card having or not having the card will have no impact on your main credit score (which is a negative score). note also that the initial enquiry is just as likely (if not more likely) to be favourable to your main credit score rather than unfavourable although that would depend how many other applications are listed on your file).

  6. #6
    Join Date
    Aug 2013
    Posts
    1,509

    Default

    Quote Originally Posted by MikeO View Post
    although that would depend how many other applications are listed on your file).
    Thanks for your helpful info.

    Personal credit checks this year:

    1. Bank - Business merchant services - they check both company and personal (approved) - x2. (side note: unfortunately unless applications are made together they credit check each one - my business applied for credit cards and eftpos separately)

    2. Utility company - home delivered gas account (approved)

    3. Bank - Credit card (approved)

    That's all I know of.
    Last edited by PTWhatAGreatForum; 29-09-2016 at 01:53 PM.

  7. #7

    Default

    Why on earth do you spend so much time on 'improving' your credit score?

    Your credit rating should be managed as not being a barrier to getting the sort and level of credit you need... Beyond that you're wasting your time and energy thinking about it.

  8. #8
    Join Date
    Aug 2013
    Posts
    1,509

    Default

    Quote Originally Posted by Don't believe the Hype View Post
    Why on earth do you spend so much time on 'improving' your credit score?
    You are reading far too much into this thread. Yes, everything I said is real. This doesn't mean it's a biggie.

    On that subject credit exposure is a tangible issue to lenders. It's also been discussed on these forums before.
    Last edited by PTWhatAGreatForum; 29-09-2016 at 02:49 PM.

  9. #9
    Join Date
    Jan 2012
    Posts
    1,074

    Default

    I've always had 4-6 credit cards totalling $80k-$120k pretty much permanently maxed and never had an issue getting the home loans I need at great rates.

  10. #10
    Join Date
    Jan 2015
    Posts
    188

    Default

    Sounds like you're playing a dangerous game there Learning!

    I'm with DBTH, I don't think it'll have much effect on the rates you pay or what's offered to you unless it's a bad score.


 

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