We all have those tasks that we wish to put off, especially ones that we think might be time-consuming or confusing, but checking your credit report is easier than you might think. Banks, building societies, mobile phone providers and loan companies are just some of the organisations that will view your credit file to assess the amount of risk involved in offering you credit.
It’s essential to check that the information contained in the report is accurate. You should aim to do this at least once a year or whenever you are applying for a loan. Otherwise a simple error in your report can go unnoticed and could make all the difference between rejection and getting the money you need.
Who compiles credit reports?
There are three credit reference agencies in the UK that collect this information:
You are legally entitled to check the information contained in your credit report anytime - not just when you are thinking about applying for a loan. There is no limit on how many times you can check your report and for £2 you can view your statutory credit report which contains the information available to lenders. While this is a one off report, Experian and Equifax both offer a monthly subscription service where you can access your account and credit file whenever you want. They also offer a free trial for 30 days, and if you decide to continue using the service you will be charged a monthly fee.
Noddle offer a free credit report and credit score with unlimited online access, however, you should check all three reports as they contain information that could influence the likelihood of you receiving a loan.
Checking your credit file for inaccuracies
There is a lot of information listed in credit reports, from bank and credit card accounts, details of any County Court Judgements, to whether your house has been repossessed or if you have been declared bankrupt in the past six years.
Make sure that the details are all correct and keep an eye out for any disused credit or store cards which may still be listed in your name, as well as if there are any old accounts, which may be active without you realising. If one of these is registered at an old or incorrect address, then what may seem like a simple glitch can have massive implications on your ability to secure a loan. This is one of the reasons you should always check your credit files, even after you have been rejected, just to check that something has not been overlooked.
Your credit report will also state whether you are on the electoral register and as this demonstrates stability, you may find it difficult to get a loan unless you are registered. You can easily fix this by getting yourself on the electoral register by either email or post.
Another area to watch out for is whether you are still considered to be associated with a former partner or someone you were once financially tied to, whether through a property or joint bank account for example, as this could affect your credit rating, especially if they have a poor crediting rating.
Details of your overdrafts will also be included in your report so it’s important that you manage your finances carefully and always aim to pay your bills on time.
We’ve put together some handy tips on how to improve your credit rating. Remember if there are any defaults on your credit report that you think are unfair, then you must report it and try to get them removed or corrected. If all else fails, you can complain to the Financial Ombudsman. Defaults can have a big impact on your applications.
What to know before you apply for a loan
Once you have viewed your report you should be able to get a clearer idea of why you might be seen as a risk by lenders. While we review each application on a case-by-case basis, it is important to remember that those with a less than perfect credit history are likely to be charged a higher rate of interest, so it does pay to review your report carefully; correct any mistakes and improve your credit score.
A 118 118 Money loan offers competitive rates of interest for people with a less than perfect credit score. We are available to talk to 24/7 so if you have any queries about your loan application, you can be sure that we are always here to help.
You can apply for a loan online in four simple steps or chat to us on 08000 118 000 or 02920 893300.