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A Visual guide to Credit Scores

A VISUAL GUIDE TO CREDIT SCORES What is a credit reference agency? An independent credit reference agency, or CRA, records financial information about individuals or a business. What is a credit score? Credit scores usually range from 0 to 999 with a high score, you're considered a lower risk. Lower credit scores are considered higher risk. There are 3 main UK credit agencies: Experian Callcredit Equifax Scores between 721 and 999 are considered a LOWER RISK to lenders. Scores between 1 and 720 are considered a HIGHER RISK to lenders. What makes a credit score? Personal details such as: Your name Past and present addresses Marital status How much credit is available to you How often you apply for credit: If you apply too often in a short space of time it may alert lenders How timely your bill and loan payments are How many individuals you're financially linked with Any past court judgments, bankruptcies or insolvencies Any store credit accounts you hold CIFAS Fraud, if any, linked with your address How long your bank account has been open Your credit score may be checked if you: Make a big purchase on finance, such as a car Take out a new Take out an mobile phone contract insurance policy Apply for a new bank account Apply for a loan Apply for a credit card or store card Apply for a mortgage, or to rent a property Set up an arranged overdraft on your existing account What can impact on your credit score? High levels of debt Not being on the electoral roll at your current address Unused credit cards left open: these possess a higher risk of credit card fraud 'Financial association': sharing assets, an account or credit (e.g. mortgages) with someone who has a poor financial record. Moving home frequently Missing bill payments: this is on file for 6 years Having a home phone number: some lenders may consider this a sign of a stable living situation Mistakes on your credit report - made either fraudulently or with outdated information. Going overdrawn on your bank account without having arranged an overdraft Checking all your information is correct: Inaccurate details can have a negative impact on your credit rating. Once you access your report, check that the following are correct: Personal details such as your name and marital status Current and past addresses, as well as addresses you've been linked to Details of bank accounts, credit cards, loans and mortgages Store credit accounts and utility contracts Any individuals you are financially linked with Late payment information The search history of your credit report - 'footprints' Any previous names you may have been known by Your electoral roll entry Any past bankruptcies, insolvencies or court judgements Any CIFAS fraud warnings connected with your address + Improving your credit score + There are a number of things you can do to try and improve your rating: Pay all bills on time Get registered on your electoral roll Meet monthly minimum payments on credit cards Cancel unused credit cards Quickly alert your credit reference agency to any mistakes on your credit report. To do this, request access to your credit file (this will cost you £2) and locate any errors. Write a short statement of explanation and include proof where possible £ £ Apply to be disassociated financially with another individual Limit the amount of credit applications you make Keep the balance on your credit card accounts low: borrowing less than 25% of your balance shows lenders you don't need to use credit too often Regularly check for suspicious activity on your credit report + Sources: etlexperian-credit-score.html public/topic specific_guides/credit h ww.a cenu pon/cifas-fraud-typehtm r-education-content/brochures/12 -questions-english.pdf Sainsbury's Bank p//w equide.orguklengland/debt e/debt borrowing money e/how lenders_decide whether_to_give_you_credit.htm nww.e e c kconmer/credit-paon/ airy-for-employment credi-rating.html -will-not-affect-credit-scores/

A Visual guide to Credit Scores

shared by Suzy on Feb 16
What makes up your credit score? What can impact on your credit score? We've answered the above and more in our guide to credit scores. Financial organisations, lenders and utility companies usually ...




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