Martin Lewis gives new warning about credit cards and eligibility calculators

“Almost every credit application goes on your credit file,” Lewis said in the latest MoneySavingExpert email. (Kirsty O’Connor/PA) (PA Archive)
“Almost every credit application goes on your credit file,” Lewis said in the latest MoneySavingExpert email. (Kirsty O’Connor/PA) (PA Archive)

Anyone considering getting a credit card during the cost-of-living crisis has been strongly advised against doing so by Martin Lewis.

When applying for a credit card, it's critical to be aware that your credit report will probably include information on how frequently you applied for prior loans or credit cards. If you submit too many loan applications quickly, a bank can view you as a dangerous borrower with a credit issue.

In order to avoid this, the money-saving expert advised borrowers to apply for a free soft check eligibility calculator first, which will show how likely you are to be accepted for a deal before applying, in order to avoid this, according to The Mirror.

“Almost every credit application goes on your credit file,” he said in the latest MoneySavingExpert email. “The system is effectively anti-shopping around, as get rejected or a worse rate than advertised, and you’ll need to apply elsewhere, but too many applications, especially close together, is negative.”

He continued: “Eligibility [calculator] searches do go on your file, but only you can see them, lenders can’t, so it doesn’t impact your future creditworthiness.”

Lewis stressed that you won't necessarily be denied credit if you have a low eligibility score on a calculator. For instance, if it states you have a 20 per cent chance of being accepted, this translates to two out of every 10 applicants. You might be one of those, Lewis suggested.

The creator of MoneySavingExpert posted an email from a reader named Lewis who experienced a similar circumstance after using an eligibility calculator.

“I applied to the top eligibility-checker result, which I’d only 20% chance, and guess what? I was accepted and offered a £3,500 limit at 0% for two years, “ he said.

“This debt was 20% APR. I can now focus on other debts, potentially having an extra £1,328ish over the 0% period to reduce the amount owed.”

Check your chances with a credit card eligibility calculator

The MoneySavingExpert website has its own calculator to check if you would be eligible for certain credit cards.

Some cards now give 100 per cent acceptance chance - meaning you’re pre-approved to get them.

Some of the providers the website searches include Barclays, Sainsbury’s Bank, Halifax, Post Office, TSB, HSBC, Santander, Natwest, M&S Bank, and Lloyds Bank.