For example if you have a credit card, mobile phone contract or a mortgage for example, then the chances are that some information about your payment performance is being maintained by one or more of the Credit Reference Agencies.
Which accounts might you find on a Credit Report?
Your credit report contains details of the credit you have held or are still repaying. Such accounts might include: –
- Credit Card accounts.
- Bank Accounts.
- Mortgage Accounts.
- Loan Accounts.
- Store Card Accounts.
- Insurance Accounts.
- Utility Accounts.
- Mobile Phone Contracts.
- Payday Loan Accounts.
It is important to make sure you keep payments to your accounts up to date to avoid any late payment information being added to your credit report. Information such as late payments can harm your chances of obtaining credit.
How can you view your Credit Report?
You have a right to see the information a Credit Reference Agency is recording about you. There are three such agencies that I am aware of in the UK. They are known as: –
All three of the above credit reference agencies will allow you to see the information they hold about you. There are a number of ways you can do this, either online or through the post. There is a charge in most cases for this service although for example, Noddle do offer a Free Credit Report.
It is highly recommended that you do check your credit report to make sure it doesn’t contain any errors. This does happen and could have happened to you. It is always worth checking your credit report before applying for credit just in case there is anything incorrect contained within it.
When you apply for Credit
When you apply for credit, the lender you are applying to will most likely carry out what is known as a credit search. They may search one or two of the above Credit Reference Agencies. When they search your Credit Report they get all the information it contains and this assists them in making a decision on whether to lend to you or not.
The data the lender sees may influence the interest rate you are offered as well as the most important decision, whether to lend to you or not. Different lenders also have different rules so whilst you could Fail a Credit Check with one lender, another may be completely happy to lend to you. It all depends on the lenders requirements and what they are looking for.
As an example if you have bad credit and applied for a Credit Card with MBNA, you would most likely fail the credit check. On the flip side, if you applied with Aqua Card, you may pass the check. The reason being that MBNA would have a much stricter criteria of who to lend to when compared to Aqua who would be more accommodating to someone with Bad Credit.
Along with other information you provide on your application, the information obtained from checking your credit report will play a part in the lender deciding how much interest you will pay on a loan or credit card for example.
When you fail a credit check you will normally get a vague explanation to tell you why. It is also important to note that the Credit Reference Agency does not make the decision to lend to you, it is the lender who you applied with who makes the decision, and they base this decision on the information the Credit Reference Agency has provided to them.
Information about your Accounts
If you hold say for example a Credit Card, information about that account is usually passed on to one or more of the Credit Reference Agencies. This typically happens on a monthly basis. The information could contain the following: –
- How well you are managing the account. For example was your payment late or on time.
- When the account was opened.
- Your available credit limit.
- Your current balance.
- Information about when the account was opened.
Information about your accounts is normally updated once a month. For example when you make a payment the fact you made a payment will be recorded on your credit report. Should you close an account, the information will normally remain on your credit file for a further six years from the data of closure.
The data on your Credit Report is provided by the lender and the Credit Reference Agency merely reports the information they are provided with.
Is there anything else on a Credit Report?
There is a large amount of information contained in your credit report. For example your current address. and financial associations as well as your previous addresses.
Another piece of information you can see is any public information held about you. This information tends to be about things like whether you have any County Court Judgments or if you have ever been declared bankrupt as an example
You can view a basic version of your credit report for free online. Have a quick Google for a company called Noddle to get started. I use their service as it provides me with all the information I could ever need, plus it’s free.
Another place you can check your credit report at is Clearscore. This is also free of charge and I also use Clearscore as well to keep tabs on my credit rating. I hope this post helped you learn about what your credit report is.