118 118 Money offers personal unsecured loans to customers who may find it difficult to get credit from their banks. We want you to ensure that any loan decision you make is the right one so we try to remain impartial where possible. We can provide you with useful guidance about the things you need to consider when seeking credit so you can make an informed decision about what is best for you.
What is a credit score?
A credit score is a numerical calculation to help lenders determine the risk of lending to you and indicates how reliable you are at paying off your debts. It isn’t just banks that calculate your credit score; it can also be credit card, utility, mobile phone and insurance companies, landlords and some government departments.
What is the difference between a credit report and a credit score?
A credit report, also known as a credit file, shows a more detailed summary of your financial reliability. It includes information about who you currently have credit with, how much you owe, who you have financial commitments with (i.e. spouses), whether you have been on time with payments, whether you hold any CCJs and whether you are on the electoral role.
Why is a credit score so important?
When you apply for credit, your lender will use a credit bureau to conduct a check the risk of lending to you. The lender will use your credit score to help them decide whether to offer you a loan.
Different lenders will have different criteria when deciding on whether to lend you money or not but the stronger your credit score the easier it will be to get credit.
Lenders will often give better interest rates and better products to those in a stronger financial position – so having a strong credit score will save you money.
Can I check my credit report?
Of course – and we highly recommend it! The Consumer Credit Act gives you the right to obtain your full statutory credit report at any time for just £2 per report.
Using agencies like Experian or TransUnion means you can sign up to a monthly subscription service where you can have access to your account and credit file whenever you like. They usually offer a free 30-day trial too.
Some simple actions can help improve your credit score, help your chances of getting future credit and get the better deals available in the loan market.
How do I improve my credit score?
- Check your credit report for any mistakes. If you find any then contact the lender and the credit reference agency.
- Get on the electoral role and make sure you have landline phone - both demonstrates stability
- Check bills aren’t being sent to old addresses
- Consider cancelling old credit cards
- Avoid applying for credit too often
- Pay bills on time and stay within your credit limit
- Avoid joint accounts with someone who has bad credit
- Avoid CCJs and debt management plans where possible
If there is information on your credit report that is accurate but doesn’t reflect your current situation (for example, you got into debt problems when you lost your job but you’re back in work now) you can add a ‘notice of correction’ to your credit report. This is a statement of up to 200 words about what happened.
Find out more about how to correct personal information on your file on the Information Commissioner’s Office website
Am I more likely to get a loan if I have never borrowed?
Having a clean credit report doesn’t guarantee you’ll get a loan. Some lenders are more confident lending to people who have a history of borrowing and repaying debt on time.
If your credit history is empty then consider getting a credit card with a low limit. Use it but make sure you pay it off every month so you don’t incur high interest.
I am ready to apply for a loan, now what?
At 118 118 Money we offer loans to people who may find it difficult to get credit from their banks. We review each application on an individual basis and offer loans with a fantastic APR of 79.9%.
We have a selection of loans available to potentially suit your needs:
You can apply online now or if you’d like to chat to us about your loan application, just call us on 08000 118 000 or 02920 893300*
We’re here for you 24/7.
(*08000 118 000 is free from UK landlines. Calls from other networks and mobiles may vary. 02920 893300 is charged by your provider as a UK national number.)