What is a credit score?
When you apply for credit, lenders check a number of things before making a decision, including your credit score.
For a quick summary, watch our short video.
What else do lenders consider?
In addition to your credit score, lenders take a number of factors into consideration when making decisions about a credit application.
Make sure you manage credit carefully
The best way to protect and improve your credit score is to use and manage credit carefully. The following things could affect your score and your ability to get credit in future:
- Declined applications
If you submit a full credit application, a full credit search will be completed. If you’re declined, this will affect your credit score.
- Multiple applications
If you submit a number of full credit applications in a short period, that can also negatively impact your credit score. If you’re declined, it’s a good idea to wait at least 6 months before trying again.
- Missing payments
You must make at least the minimum payment on time each month, as detailed on your statements. If you miss a payment, this will be recorded on your credit record.
- Going over your credit limit
If you go over your agreed credit limit, that may also be reported on your credit record.
Frequently asked credit score questions
All lenders have different criteria for assessing applicants. If you have a low credit score, that doesn’t necessarily mean you can’t borrow, but it may mean that you aren’t offered the lowest interest rates or a high credit limit.
Submitting a number of credit applications could affect your credit score further, so look for lenders who offer an eligibility check first. That way you can find out if you’re eligible to apply for a credit card, without affecting your credit score.
All credit reference agencies collect similar information, although they don’t necessarily hold the same details, which is why it’s a good idea to check more than one if you’re working to build your score.
As well as information about the way you manage credit accounts, credit reference agencies also collect details from public sources, such as the electoral register and court records.
If you’ve checked the information held by a credit reference agency and there’s an error, you can contact the agency and ask them to investigate and correct their records.
They’ll make a Notice of Correction, which anyone reviewing your credit history in the future will take into consideration.