First time buyers: How the address history can ruin your credit score – ‘be aware’

Martin Lewis gives advice on paying mortgage with savings

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Matt Coulson, director at Heron Financial, the UK’s largest independent mortgage and insurance adviser urged that this small detail could be detrimental in the future when applying for mortgages so it should not be overlooked. He said: “As a student, when moving around each year, living in different places, it’s important to keep your address history up to date.

“This means updating your details at bank, with credit card providers, with the electoral roll, with utility bills they might pay every time you move.

“It’s a huge thing for lenders as it’s what they look at to track your past.

“It’s crazy how so many first-time buyers who were recently just students that come to use for help did not know that their address history was even relevant.

“You wouldn’t want all of the work you may have done with a credit card to boost your profile to be weakened because of this small detail.”

When thinking about the future and eventually applying for a mortgage, students can look at applying for a student credit card.

A Student Credit Card can be a great way to cover unexpected expenses and build a good credit history.

When discussing the value of student credit cards Mr Coulson said: “You can use it for daily spending, so to hop on the bus, or the tube or the train.

“Or just buying petrol here and there. The most important thing is making sure to clear it.

“Use it relatively regularly every month for little things. It’s not just for making big one of purchases and then sitting on it.

“When clearing these purchases down every month, make a payment that’s bigger than the minimum required amount.

“This is a really good thing for your credit profile and will help when buying properties in the future as it shows lenders you’re responsible.”

When working to build a good credit profile it’s important to be aware of the small details that can affect it.

Having a general awareness of your credit profile from 18 can help ensure there are no surprises when eventually looking at mortgages.

Mr Coulson said: “If you can start early by building that credit, that’s great.

“Take out a credit card with your existing bank because that will be the easiest.

“Get one with a low limit of £1000 and don’t allow yourself the temptation to go crazy and go past it.”

Most high street banks offer student credit cards, and this is a great way to get started with credit.

Be sure to do some research to find the banks that offer the best deals and rewards with their student credit accounts.

Mr Coulson concluded by giving this advice: “It is a good idea to get it but use it wisely and be sensible with the way you make use of it.

Enjoy yourself but be aware it can either positively or negatively impact you in a few years.”

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