UK Consumer Credit Referencing


The Quickest Ways To Improve Your Credit Score

In the current economic climate, banks and other financial services companies are being even more strict about who they lend to and the terms of any credit agreements. With this in mind, it is important to understand exactly what influences your personal credit score, and what you can do to improve this score quickly to ensure that your credit file is as solid as possible.

Credit Score

Contrary to popular belief, it isn't the case that every consumer has a single score that banks and other lenders can check when a credit application is being made. Instead, lenders will use three sources of information: your application form, your history with the company, and files from credit references agencies, which include the likes of Equifax, CallCredit and Experian.

What's on my file - how can I see it?

You can see your own credit report. The information in the credit reports of all main agencies broadly overlaps, although each may have some unique data. You can apply to one, to get the idea of the type of information held about you, or apply to all of them individually to check your credit report with each agency.

These credit reference agencies will be able to supply a lender with a whole host of information about you, taken from court records, fraud data and your electoral roll information, along with details of previous credit searches, other addresses you are linked to, and other people that you have a financial association with.

Credit Reference Agencies

While it may seem a little scary that companies can have access to so much personal information about you, there is plenty that can be done to ensure that this information is as up to date as possible, and that your credit score is as high as it can possibly be. The first thing that you will need to do is to check your credit file to make sure that there are no errors - this can easily be done via the Equifax, Experian, or Transunion websites, but may involve a small fee. However, the credit agencies sometimes offer a trial, meaning that you can check your credit file free of charge, although you should check at the time, and check the terms and conditions.

If there is anything in your file that you disagree with, query it immediately - mistakes do happen, and you may find that a lower credit rating is no fault of your own. If, however, your credit score could do with improving, there are steps you can take to build up your score quickly and easily.

Tips to Improve Your Credit Score

Firstly, make sure that your details appear on the Electoral Roll at your home address. Aside from anything, it is illegal not to be registered, and those who are not registered could face a fine. More importantly for your credit rating, however, is the fact that lenders will use the Electoral Roll to check address details - and if they can't confirm where you live, you may well be turned down for credit because of a problem that could easily be rectified.

There may have been times in the past when you have had credit problems due to reasons such as a divorce, a family bereavement or losing your job. What you may not know is that (if your records show that you were able to find yourself back on track after such problems were over) you are able to add a note to your credit file that explains the reasons behind any late payments due to these reasons and demonstrate how these late payments were corrected.

Your credit file may also contain links to people to whom you had previous connections, whose personal credit ratings may have affected yours. You may, for example, have held joint accounts with an ex-partner that have affected your credit score in a negative way and are still on record, despite your personal situation having improved since then. It may be that your ex-partner has a poor credit rating which, in turn, is impacting on your own, as links with that person are still recorded. If you no longer have any links with the person in question, you can ask for these links to be removed from your records.

You should also be sure to close any accounts that you no longer use. While it may seem like a sensible idea to have overdrafts and credit cards that you do not currently use but which you are keeping hold of in case of emergency, it may actually affect your credit rating. Companies that are performing these checks will be able to see that you have access to even more credit without further checks, and it is this uncertainty regarding future repayments that can lower your score. By having these accounts open, you are also increasing your exposure to potential fraud.

To improve your score, the key thing is to make sure you know what is in your records, and keep them updated: improving your credit score may actually be easier than you think.



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