Your credit rating with credit reference agencies like Experian, Equifax, CallCredit or CheckMyFile can be accessed by any business or institution seeking to check on your credit worthiness. Your credit report with such an agency is an almost inevitable early checkpoint for financial institutions and lenders. Keeping a squeaky clean high-score credit reference is good, and trying to improve your score is helpful to you.
Ways you can do this can include:
> Ensuring that you are registered on the electoral roll at your current address.
> Making sure all your debts are registered to your correct name and current address.
> Ensuring there are no other mistakes on your file, such as other people’s debts or payment.
> As a borrower, do everything in your power to keep up all agreed repayments to lenders and ask for smaller repayments if you’re struggling. It is better to stay within a re-negotiated and agreed schedule than to fail.
> Close down any credit agreements you no longer use.
> Joint finance done with someone with a bad credit report will affect your rating. If you can separate yourself from this arrangement, do so, and then write and tell the agencies.
> Apply for credit you are likely to get.
> Don’t make too many applications for credit in a rush – and that includes things like mobile phone contracts. Lenders might see this as signalling desperation or a lack of financial planning and reliability. Space out applications.
> Show lenders you’re a responsible borrower by borrowing and paying it back. It might mean taking a credit card with a very high interest rate. Only spend small amounts and then keep clearing the balance, thereby not being charged interest. You may need to do this for at least six months for such behaviour to register on your credit rating.
Things that look good in your credit report and that lenders like to see on application forms are:
> Fixed land phone lines rather than mobiles
> Long-term employment history
> Long-term living in one place, ideally owned rather than rented
> Long-term record with the same bank.