UK Bill Help

A decent credit score is important to everyone, whether you are seeking to apply for a credit card, loan, home mortgage, or even a job. Find a list of tips and suggestions for how to improve it. As the credit score matters more than most people realize.

Your score, which is calculated by one of 3 credit reference agencies (CRA), can affect your employability, as some UK employers now review it. The score can impact the interest rates you pay on credit cards and loans, whether you can obtain credit cards and loans, insurance rates, and even whether you can rent an apartment or house. The CRAs all use different ratings, with Experian having a maximum of 999 and Equifax being 900.

Your credit score can quickly drop for a variety of reasons. It will temporarily fall if you apply for credit and someone makes a hard inquiry on your credit report; this is true even if your application gets approved.

Not paying the bills on time also has a major impact. Your score will drop if you are late on payments or miss them altogether. Reports of unpaid obligations, such as your mortgage, will hurt your score, as will using more than 30% of your available credit.

How to quickly increase your credit score

First, check it with CRAs including Noddle and Experian. If your credit score has dropped too far for your tastes, there are some things you can do to raise it quickly with the credit reference agencies. Here are the top three ways to do so.

First, make sure you are on the local council tax bill in your borough or city. CRAs and mortgage lenders use this for information, and the borrower also needs to be ensure they are registered on the electoral roll. The 3 CRAs are also starting to use utility bills to determine creditworthiness of the borrower, so ensure electric and fuel bills are paid on time.

Pay down existing credit cards and revolving credit accounts. Never miss a payment or be late on any bill. If you cannot pay down your accounts promptly or make a payment on time, you could contact your bank or lender to see if they can offer help. Maybe they will give a repayment plan. Or the borrower may apply for a Debt Arrangement Scheme (DAS), and all of these are better options for a credit score.

Keep your credit usage low, within range. Your usage should not be higher than 30% of the credit that is available to you. For example, if you have one credit card with a $500 limit, one with a $300 limit, and another with a $1,000 limit, the amount of credit available to you is $1,800, which means you should owe no more than $540 on the three cards combined, i.e., 30% of $1,800.

Get a new credit card. Opening a account can help your score by increasing your total available limit, but do this sparingly. Only apply for cards you know you will be approved for, with the understanding that this will cause a hard inquiry to show up on your credit report as we indicated above. A new account also will change the average age of your accounts, which can have a small negative impact on your score.

If you are struggling or have difficulty in getting approved, a secured credit card is the best option for this purpose. Do not apply for cards or revolving accounts within a short period. Wait months before submitting a new application. Just one new credit account can give your credit score a 35- to 40-point boost.

Open a bank account and get a job. A council affiliated credit union, which are not for profits in the UK, can also be great options for quickly building a credit score. Ensure the CRA reports reflect the employment and bank information.

Dispute incorrect items on your CRA credit report. Many lenders make errors, and those can be reflected on the CRA score(s). When you take a look at your credit report, don’t be surprised if you find mistakes or issues that already were resolved but didn’t get removed. You can dispute these errors through the credit reporting agencies’ websites.

Most things stay on your credit report for seven years while some remain for 10. Some debts, such as medical bill or a mortgage, might be on your report for just two to three years.

Just doing these quick and simple things can give your credit score a big boost. They are all free to do, and no not involve any administrative or composition orders. Once your score is where you want or need it to be, you should keep an eye on it so that you can quickly resolve problems in the future. There are numerous free and low-cost services available to help you do this.