What to look out for on your credit file

Every time that you put in an application for a line of credit, whether it is a personal loan, a fast payday loan application or any other type of credit, your credit file and history will be looked at by the lender to determine whether or not you are a viable candidate to be given the loan. There are hundreds of thousands of interactions that result in an applicant being turned down for this in the UK alone, and it is important that if you have been rejected for a loan application, that you understand why and know what to do about it, so it doesn’t happen again in the future.

What is on your credit file?

Your credit score is the biggest indicator as to whether or not you’ll be successful when applying for a loan or another type of credit. There are three main credit reference agencies in the UK. This is where you need to head to, to find out exactly what is going on with your credit file and to determine what aspects of the information need to be changed or worked on for you to improve your credit score and have a better chance of success in the future when applying for credit of any kind. These credit agencies are:

  • TransUnion
  • Experian
  • Equifax

When you make an application for credit, these are the agencies that the lender will look to for information about how you borrow money and any credit searches that you have made in the past. Your credit file paints a picture as to whether or not you are a credible borrower and whether a lender should trust you to pay back the money you have applied for.

Your credit file includes all the information that allows a lender to confirm your identity. It includes a record of your borrowing history and your record of paying back credit. It includes all public records that are held on you and any credit searches that you have made in the past when applying for credit.

What can I change on my credit file?

There are a few things that you can look for that will immediately make a difference to how attractive you look to a prospective lender. The first is the electoral roll. Are you registered to vote? If you are registered to vote, check your credit file to make sure that you are registered to vote at your current address. People who are not registered to vote are statistically less likely to keep up with debt repayments.

The second part you need to check out is your list of addressed. Your credit report keeps track of your property history. If you have moved a lot over the last six years, it may become more difficult to borrow.

Your credit score is a figure that indicates how much of a risk you are to a lender. Your credit file will highlight this figure. The lower the credit score on your file, the higher the risk you are to a lender and the less likely you are to be successful with any credit application.  Your borrowing history plays a part in this, every time you make a repayment on any line of credit, it is recorded on the file as a positive and helps to increase your credit score. Equally though, any negative aspect of repayment, such as late or missed payments will have an impact too. Serious problems such as County Court Judgments (CCJs) will be a serious mark against your credit score.