What’s the score with credit?

What’s your credit score?

A question which, if you know the answer or at least know how to find out the answer, could be the difference between being able to buy your own home, achieve financial security and have the ability to confidently plan for the future. If you don’t, then these goals may, at best, cost more to achieve or, at worst, remain out of reach

In many regards, the financial world has changed immeasurably since the Financial Crisis of 2007-2008. In general, ‘prudency’ is the keyword for lenders and the regulators now. Proving that you are a safe bet to lend money to, is now the cornerstone of any credit application, especially mortgages. Thankfully, the days of lenders falling over themselves to lend to anyone and everyone are behind us. Nearly everyone I meet as a mortgage advisor is aware that information on their credit history is held by someone, somewhere. In the modern world data rules and in some situations a computer will have the final say. How does it do this? By assessing the numbers and one of these will be your credit score and credit history.

What’s the Score with Credit?

When we apply for insurance, buy something on credit, apply for a credit card to transfer a balance or seek to obtain certain types of financial products, it is likely that somewhere along the line a credit search is done on you. Imagine you are on the phone to a potential insurer for your car. You want to pay by monthly direct debit so to do this you provide your name, address, date of birth. That is then followed by a few moments of silence waiting for the person on the other end of the line to come back and say all is fine. What have they done? Well put simply, they have checked to see if your credit history shows you to be reliable. If your history says that you are not, then they may decline you for paying monthly and need the payment in full upfront. This simple example shows how important your credit history is to be able to obtain, manage and pay for even the simplest of financial products. The ability to be able to pay monthly is for many a necessity to being able to juggle the weekly shop, household bills and family needs.

How can I find out what my Credit Score is and view what the lender can see?

There are a number Credit Score agencies in the UK who will allow you to access the data they hold on you, initially for free or by paying a monthly fee to them thereafter. One of the issues to be aware of, however, is that not every credit provider uses all of the individual credit reference agencies themselves. Therefore it is possible you may obtain a copy of your credit file from one such provider which does not contain all, or the same, information held by others.

To overcome this issue, we would recommend you use a provider such as Check My File who provide the UK’s only Multi Agency Credit Report.