If you are applying for a cash loan, mortgage or credit card, then you may find it beneficial to check your credit score. Even small errors on your credit file can affect your application but if you check before you apply, you can rectify any issues.
What is a credit score?
Your credit score is based on information provided in your credit report and is calculated by the credit reference agency providing the report. There are three main credit reference agencies in the UK:
– Experian
– Equifax
– Callcredit
Lenders will use the information provided by one or more of these agencies to decide whether to offer credit, how much to offer and in some cases what interest to charge.
How can you check your credit score?
All three credit reference agencies allow you to subscribe to a free trial which allows you to check your credit score and your credit report. Though, you should remember to cancel the subscription before the end of the trial period or you may be charged a monthly subscription fee.
Clearscore, who have partnered with Equifax, also allows you to check your credit score by giving you free access to your report.
What if you have a low credit score?
If you have a low credit score, then check that all the information on your credit report is accurate.
– Check your personal details and address
– Ensure that all bank accounts, loans and credit cards listed for you are correct
– Raise any unfair or incorrect defaults with the agency
– Remove your name from any joint accounts linked to previous spouses or partners
If you have confirmed that all the information is correct but still have a poor credit rating, then you may be refused credit from some lenders.
The good news is that all lenders base their decisions on their own set of criteria so being refused by one lender doesn’t mean you won’t be accepted by another.
Don’t apply for credit from several providers in a short space of time as this may damage your credit score. If you have an application for credit rejected, try and build up your credit rating before applying again. Cancel unused credit and store cards, pay your bills on time and clear down your debts.
(Ad) At Morses Club, we provide doorstep loans which we approve in person. We may be able to offer loans where other lenders have declined an application, but this is not always the case.
As a responsible lender, we like to ensure you understand our process before making your decision. To find out if our loans are the right solution for you, visit our ‘how it works’ page.
Representative Example: £200 loan repayable over 20 weeks at £15 per week , Rate of Interest 50% fixed, Representative 756.5% APR, Total Amount Payable is £300
Compare the price of home collected and other cash loans available in your area at: www.lenderscompared.org.uk