Credit ratings are such bunk.
I followed all the advice, actually completely paid off an old debt and after months finally managed to reach Fair, but then one large spend on my credit card dropped it to Needs Work, even though my income history showed I could pay that off in 2-3 months.
It depends who's advice you were following.
Making a large purchase on a credit card and paying it off over a few months will usually hurt your credit, if starting off with a low credit score.
I usually listen to Martin Lewis from MoneySavingExpert.com
To successfully built a credit rating from a clean slate or after bad credit you really need to pay any credit card off
IN FULL at the end of every month.
You also need to keep below 25% usage of your entire credit. So if you only have 1 credit card with a £1k limit, keep it below £250 and pay it off IN FULL every month.
Changing broadband or mobile phone supplier too frequently can hurt your credit. Lenders like stability
Not being on the electoral roll can hurt your credit. Moving home too often can hurt your credit.
More than 1 new credit account/application in a 6 month period can hurt your credit.
Stick to those rules and for most people their credit score will gradually rise over time. Anything over 6 years old will disappear from your credit file completely even if the debt is still outstanding.
To confuse things the 3 big credit reference agencies all score differently. Something that increases your score with 1 agency might hurt it with another.
For whatever reason some people pay to monitor their credit score but you can check all 3 agencies for free via the following sites/apps....
clearscore (equifax)
credit karma (transunion)
Mse credit club (Experian)
Once you have a high score (especially if you have a mortgage) lenders are less concerned about paying credit cards off in full every month or using a higher % of your credit limits.
It's something I didn't care about at all when I was younger.
