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A credit score to settle

Do you take the time to check your credit score? Do you know what information it could include? It is important to keep an eye on it – here’s why.

If you want to qualify for the most competitive loan and credit card rates then you need a good credit score. What’s more, you need it to stay that way.

Credit scores are used by banks and credit card companies to determine whether they will lend to you and at what interest rate.

According to Barclaycard, only four in ten of us have ever checked our credit score with a credit reference agency and only one in four know their credit history.

In a world where access to credit is so important, these figures are shockingly low. Particularly as checking your credit score is quick, easy and often free.

Here our colleague Michele Martinelli tells us what happened with his credit score and shows you why you should make sure you know what yours is saying about you.

Computer says no

Until fairly recently, I was part of the majority. I had never checked my credit score and wasn’t planning to. I’d never been rejected for anything and assumed I was fine. I was wrong…

About six months ago, I decided I wanted a new phone. I spotted one I liked, used a comparison site to find a good deal and I applied.

So far so good.

However, a few days later, I received an email from the provider telling me my application had been declined.

Why, I wondered. I asked the provider who told me they couldn’t give me specific information, but suggested I check my credit score.

Taking advantage of a free monthly trial with one of the most popular credit reference agencies, I signed up and found I had a near perfect score.

Hmmm…

I tried to get my phone and was again rejected. I gave up.

Computer says no… again

A few months later, I decided to take advantage of a new bank account and tried to switch my current account using the 7-day switch guarantee.

I went into my nearest branch and everything was fine until it came to processing the application. Rejected again!

I didn’t understand, I even showed the bank clerk my near perfect credit report, but to no avail. He said he couldn’t help, but suggested I check my credit score using the other well-known credit reference agency.

 

A breakthrough

The second agency also provides a free one month trial, so I signed up and received my credit score.

This one told a very different story. For some reason, despite having a bank account, credit cards and several subscriptions, I had no credit history. Zilch, nothing.

According to this agency, when it comes to my personal finance history, I didn’t exist. No wonder I was getting turned down.

I called up the credit reference agency and was told the only way to fix this was to call up my bank, credit card provider and any other financial institution I had a credit agreement with and tell them to update the agency.

They offered no explanation as to how it happened, or how to stop it happening again. I’m waiting for them to update my records over the next few weeks.

Don’t miss out

The moral of the story is that it’s always a good idea to check your credit score. You never know when you might need it.

It is often worth getting a copy of your credit report from all three credit reference agencies if you’ve not applied for it before or if you’ve not checked it for quite some time. That’s because different credit reference agencies may have credit information from different lenders (although there is quite a lot of overlap between them).

I missed out on two great offers, because I didn’t and sure, there are more important things in life then getting a new phone, but what if you needed to take out a mortgage? Or a loan?

What do you think?

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  • glen byrne / 21 December 2015

    id like to no what mine is, not sure if have I have ever checked it

  • Kwabena Adu / 14 December 2015

    Good to know that

  • Lesley Ferguson / 13 December 2015

    Definitely agree there should be one national credit agency at present it is a system designed to provide income for the 3 credit agency providers.which clearly are not even able to do a satisfactory job if they cannot provide a credit score for someone with an unblemished record.

  • JIm / 13 December 2015

    You were the victim of a failed system. If you had not been able to correct it during your free trial period you would have had to pay to rectify someones error.

    This cannot be right. What is the role of the Financial Authorities in this.

  • Russell / 13 December 2015

    We first need to be aware that there is no such thing as a universal credit score, as each lender uses the available information in different ways to suit their own commercial requirements.
    Also, each lender can chose which credit reference agency or agencies that they wish to use. so it is quite possible for you to see three different reports from the three suppliers.
    If you take out credit, you are now asked for your explicit permission for data to be shared with the agencies. This may explain some differences.

    An account which has been open for a long time may not show, even if it is active, as at the time it was opened the lender may not have been sharing that type of information.

    The lenders own the information shown in your Credit Report, so as mentioned above you need to contact those lenders whose information is not displayed to see if they are able to add this to improve your Report.

  • Pamela Watson / 13 December 2015

    I was turned down for a small loan. My bank advised me to check my credit rating with all 3 agencies. I scored 99.9% with the most well known company but only in the 70s with the other 2. I queried this & found that it was because I had recently moved. Although I had registered to vote in my new area this info had not filtered through to the agencies I was deemed high risk as I was not a registered voter in their eyes!

  • Kenn D Crossley / 13 December 2015

    How do you check your credit report (by all three main agencies!) "regularly" without subscribing to all three services? This system is ridiculous. If even anything should be provided by one National, or even State, body then this is it.