Your credit score is calculated based on a multiple of factors including your credit history and the way you handle your store cards, credit cards, loans, mortgage and insurance payments. And, depending on how you’ve managed your credit, it could affect whether you can get mortgages, credit cards and loans in the future, but also mobile phone contracts, bank accounts and much more.
But don’t fear, if you’re worried about your score, there are ways to make sure it’s in tip-top shape.
Check before applying
Make sure you check your credit score before applying for any type of credit as being rejected can have a negative impact on your score. You can check your score for free with a bunch of websites like Experian, Equifax and ClearScore. Although most score checks are free, you can get a more in-depth report for a monthly charge. However most come with a free 30-day trial, so you could check your report and set a calendar reminder to cancel the subscription before the trial ends.
You can also earn £2.25 cashback if you check your score with Experian and go via us!
Get on the electoral register
Making sure you’re on the electoral register gives you a better chance of getting credit as it ensures you are who you say you are. It’s also important to ensure all of the addresses you have lived at are recorded. You can do this by signing into your credit score account and updating your personal details.
Don’t miss or be late with payments
Missing a payment or even making a late payment can stay on your credit file for as long as six years. So, if you’ve ever missed a payment due to circumstances beyond your control, talk to your credit provider and see if they can remove the black mark against your name.
Use a credit card correctly
If you’ve never really had credit before, it can make it more difficult to get credit from lenders as they’re unable to assess your financial stability. If you find yourself in that situation, consider taking out a basic credit card and make a few small purchases on it each month and repay the balance in full by setting up a direct debit. That way, you’re able to show you can responsibly manage credit.
Know your financial partner
Deciding to combine your finances with someone you live with, your partner or a friend, for a mortgage or a joint bank account can have a negative effect on your credit rating. Ensure you’re aware of their financial credit before merging. If you have merged your finances but the relationship has come to an end, ensure the person’s name is removed from any of your financial accounts.
