When we started looking to purchase a house a few years ago, it transpired that my husband’s credit score wasn’t as good as it could have been for a few reasons. It took a lot of hard work over the course of two years, but we now live in our first owned home and that’s thanks to the steps we took to improve his credit score.
Have you found yourself in the same position? Then read on for 5 quick ways to improve your credit score.
1. Electoral Roll
Make sure you are registered to vote. It takes around five minutes to apply online to be added to the Electoral Roll and this makes you appear more credit worthy to lenders.
2. Challenge defaults and late payments
When we sat down for the first time with our mortgage broker back in 2016, it transpired that my husband had two defaults on his credit file- one from a mobile phone company and one from his old bank. When we discussed how these defaults had come about, I decided to write to both companies and request that they be removed, stipulating the reasons why I felt they were unfair. The mobile phone company refused, but the bank agreed with my points and not only removed the default (and it was for a considerable amount) but also gave us compensation of £100. For the time it takes to draft a letter, it is well worth challenging any defaults or late payments you find on your report.
3. Show you can repay in full and on time
If you have had little credit in the past or have multiple late payments on your file from a few years ago, it is well worth showing lenders that you have changed and can now pay in full and on time. If you do have a slightly dodgy credit score, it may be hard to obtain credit, but you could try a payday loan such as Cashlady.com or a high interest, credit building credit card. The imperative thing is you pay the amount you owe off in full every month.
4. Reduce debts on cards that are close to the limit first
If you have a credit card balance that is close to its limit, you need to make sure you are taking steps to reduce this debt first. Lenders do not like it when you are close to your limit as it can be seen as you not being good with money. We worked hard to get the amount owed on each card under 50% of the total credit limit. You also need to make sure that your short term debts are a low percentage of your annual salary too.
5. Make sure your personal details are up to date
Have a good look through your credit file (I recommend downloading your statutory file from Equifax for £2) and make sure your names and previous names, addresses and linked associates are all up to date and correct. Notice anything unusual? Challenge it and you could see a vast improvement in your credit score within weeks!