Our credit record is the information that a lender will use to decide whether they feel they want to give us a loan. This means that it is really important to make sure that it is correct and that it is the best that it can be. You therefore need to be aware of what it says and then know how you can improve it.
It is possible to look at your credit record for free through certain companies. Do some research and find one that you trust and take a look. It is worth noting that you should never have to pay to look at it and it does not affect your credit score if you look at it.
Once you have looked at it you will be able to see whether there are things on there to improve. It could be that you have a great credit record and you have no need to do anything but this is unlikely as most people have some areas that they can improve. However, it is worth noting that different people who check your credit record are looking for different things. This means that you may have the perfect credit record for one company but not another.
It is worth checking to make sure that everything is correct. If you think that they have got something wrong then get it changed because it could make a big difference. For example, if it says you have bills outstanding which you have paid off, then by getting that altered you could really improve your rating as they will know that you are reliable with regards to paying things. If you are about to apply for anything big then it is well worth checking even if you have done it recently, just in case.
If you have no registered to vote then it is unlikely that you will get any credit. You do not have to vote of course, but once you are registered it means that potential lenders will be able to use it as an ID check. If you are not eligible to vote then you can send the three credit reference agencies proof of residency to help you to get credit. This is the only way you’ll be able to borrow money.
Do not get behind in any credit repayments because it can mean that you will not get any more. If you set up all payments by direct debit then it is much harder to miss a payment. Try to avoid going in jointly with anyone that has a poor credit record. This could mean that you should not be jointly named on a bill or account with anyone, even if they are a flat mate, as it could have a bearing on your rating. Once you are no longer together, make sure that the credit reference agencies know that this is the case and it will mean that their future credit history will not affect yours.
If you apply for lots of credit this could have a negative impact. Therefore try to do a soft search to see whether you are likely to be accepted first. This will only be visible to you and so will have no impact on your credit score. Do not apply for credit too often as the application will show on your report and if you get rejected a lot then this will not look good.
Make sure that you have no mobile phone contracts, credit cards or things like this registered to old addresses. Having lots of addresses on things in your name could make ID checking not go through properly.
One way to improve your credit rating is to use a credit rebuild cards. These are credit cards with very high interest rates for those who want to improve their rating. If you pay off the full balance each month you will not pay any interest and so the cost of it will be irrelevant. If you have a card that you do not use, you could use that instead and get the same result. You do not even have to pay that much out on it each month to benefit.
Never draw cash on your credit card. As well as being expensive a lender will see it as evidence that you are not managing your money well. The same with a payday loan, as although lenders may say it will improve your credit rating it is unlikely and many mortgage lenders will never lend money to someone who has had one as they see it as a sign of poor financial planning.