It used to be the case that a good relationship with your Bank Manger would mean you could borrow money based on your personal circumstances, but now complex digital records of you as an individual, mean that many decisions are based on a automated computer system. Polishing up on your score can lead to beneficial borrowing rates and products.
1. Understand Your Score – take some time to check your score. There are 4 agencies in the UK (Equifax, Experian, TransUnion and Crediva) and most offer a free trial to view your file. You can also use third party companies such as Clear Score or CheckMyFile which cross reference the agencies. When reviewing your file, don’t just look at your score, check your accounts, your payments and your financial associations.
2. Get On The Voters Roll – one of the easiest ways to enhance your score is to get on the electoral roll at your address. This gives the agencies a physical location for you and reinforce the fact you are real. This is done with your local authority.
3. Use Credit Cards – using credit regularly and responsibly is key to building your score. Keeping your credit card active, by spending small amounts and paying your bill off each month, makes you appear more attractive to lenders and can help boost your score. This is because it shows you can reliably pay back any money you borrow.
4. Fix Mistakes – if you see something on report which isn’t quite right, for example you have paid off a loan, but it shows as open, then speak to the provider and ask them to correct it. Its important your record is a true reflection as new lending decisions are based on this.
5. Avoid Multiple Applications in a Short Space of Time – this can damage your rating. Every time you make an application, a search is registered on your file. If you apply multiple times in a short space of time, the lenders may view that you are desperate for credit as they will be able to see all of these searches.