How to give your credit score a boost

How to give your credit score a boost

What is a credit score?

Your credit score is calculated by a credit reference agency, based on the information in your credit file. Credit reference agencies hold information on every UK borrower, including; electoral roll information, any previous credit applications, any history of debt (including County Court Judgements and bankruptcies) and your credit behaviour.

There are three credit reference agencies in the UK – Experian, Equifax and Call Credit. Each credit reference agency calculates your credit score differently. However, they all show lenders how likely you are to be accepted for credit.

How can I view my credit score?

You can check your credit report and find out your credit score online. Free trials are available from Clear Score (Equifax) and Noddle (Call Credit). These services will inform you whether your credit score requires improvement to increase your chances of obtaining credit.

Can I improve my credit score?

If you need to improve your credit score, there are steps you can take to give it a boost. Here are a few of our top tips:

1) Register on the electoral roll

Lenders use the electoral roll to confirm you live at the address you provided on your finance application. If you are not on the electoral roll at your current address, it is unlikely that lenders will allow you to borrow money.

2) Make sure you pay your bills on time

A missed payment can have a very damaging impact on your credit score, so paying your bills on time is a must. If you are struggling to make your monthly repayments, speak to your lender as you may be able to come to an agreement with them.

3) Consider your financial links

Make sure you are not financially linked to someone who has a poor credit score. Do not take out a joint bank account or joint finance with a partner if they have a poor credit rating.

4) Build up a credit history

If you have a thin credit file, for example; if you are a student, you may need to build up your credit history. Taking out a mobile phone contract or a credit card can be a simple way to improve your credit score. However, you must ensure you make your payments every month.

5) Don’t make too many credit applications

Multiple credit applications can have a negative impact on your credit score. If you are rejected for credit by a lender, do not reapply straight away. Instead, check your credit report to see why you have been rejected and make sure there are not any issues before reapplying.

 

If you are applying for credit, use a broker like Freedom Finance. Freedom can search over 20 lenders to find the right loan for you without impacting your credit rating.

 

The above post does not constitute as financial advice and is intended to be informative.

 

 

Need guides to borrowing?

Our aim at Freedom Finance is to provide you with the information you need to make educated decisions when it comes to your borrowing and your money. The online financial market place is filled with conflicting, jargon-filled information about which loan product is the right one for you.

These deals may look attractive, but many of them apply only to those with an outstanding credit history. In reality, the best deal on offer might not be available to you. With our comprehensive finance guides, we aim to equip you with the know-how to make the best decisions about your borrowing and your money.

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Whether you're planning on some home improvements, replacing your car or simply getting your finances in order, a loan from Freedom Finance could be more affordable than you think. Use our calculator above to find the ideal loan for you. All quotations given are for illustrative purposes only. Credit subject to status. The rate you are offered will depend on your personal circumstances, credit assessment procedures and other related factors.