The world of credit history, files and scores is a scary one for many people, but it’s also incredibly important for people to know what can affect it in both a positive and negative way. Do you have bad credit? Read on to find out what you can do to improve your credit score.
The most important part of understanding your credit file is to find out what’s on it. There are three major credit agencies which companies use to request your file when doing credit searches. These are Experian, Equifax and CallCredit, and they all offer online services to take a look at your credit file on the internet. What’s more, they also offer 30 day free trial periods of these offerings, so you can take a look without paying a thing!
If you don’t want to get all technological, you can pay these agencies just £2 and request a hard copy of the file they have on you. Knowing what goes into your credit report – and what affects it – will help greatly when you’re working on trying to improve your score.
When you apply for any kind of credit, be it car finance, a mobile phone contract, a credit card or a mortgage, the lender wants to know you’re a safe bet. They look for things like address history and whether you’re on the electoral roll. If you’re not on the electoral roll, you’re going to have a big problem as it means you lack “traceability”.
In fact, it is now a legal requirement to be included on the electoral register. If you don’t, you could receive a fine up to £1,000 and nobody wants that. Contact your local council to get on the register. It’ll pay off massively once you’re on there, and you can even opt out of the public register if you don’t want your details to be put on it.
This should be a no-brainer, but it’s a common mistake people make. The great thing about credit agreements is that it can help spread the load of a large purchase across multiple payments. Many people still get into problems down the line when they realise they can’t make the repayments and stumble into debt or worse. It’s not too late, though. Lenders can be known to be fairly flexible, and if you can’t make repayments, you should call your credit provider and request smaller repayments to make it easier to stay up-to-date.
Every time you apply for any form of credit, the lender will run a search on your file and make sure you’re the kind of customer they want to lend to. This will leave a mark on your file every time, and too many searches could put lenders off. Not all providers do this, though, and there’s a type of search called a “quotation search” or “soft search“, which won’t adversely affect your credit score. If possible, you should request a quotation search rather than a credit search, so they can tell you the likelihood of being accepted if you were to go ahead with the application. At Creditplus, we take ethical lending very seriously and will always run a soft-search on your file.
If you are concerned about your credit rating and are looking for tips and advice on improving your score, than visit our Credit Clinic. Divided into four sections, we explain more about credit ratings and what can affect them. In the diagnosis section, we explain the five different credit ratings and what they mean for you. In casues, we list some of the adverse credit that can cause your credit rating to be lower. The treatment page tells you some of the steps you can take to start repairing your credit file. And finally, the resources page points you towards free unbiased debt advice services that can help you get back on track.
Do you have any tips on how to repair your credit file? Let us know below!