If you are concerned about your credit rating or have a bad credit file and want to correct it, you’ll find some useful information and practical tips below. Note, if you are experiencing difficulty meeting your financial commitments, seek professional advice as soon as possible. Don’t ignore it. The sooner you talk to your creditors, the easier it will be to find a solution.
It is important your credit file is kept up to date as it is used as a basis for decisions for financial applications such as car finance, credit cards or mortgages. If you have a bad credit file, you can help clean it up, there are 3 top tips you can follow.
The golden rules for maintaining a good credit report
1) Always pay your bills on time, that includes your mortgage/rent, utilities, council tax etc
2) Manage your finances well, don’t go over your overdraft limit
3) If you have credit cards try and pay the balance off each month or at least ensure you pay the minimum payment and don’t fall behind
4) Pay all loans and credit facilities on time
1) There are 3 credit reference agencies, Experian, Call Credit plc and Equifax plc. They will all hold information about you and your financial arrangements so it important you contact them and obtain a copy of your credit report.
When you receive the reports, review them diligently to ensure all details are correct. Information is updated at regular intervals but this can be months apart. Credit agencies are required by law to investigate and deal with any mistakes so make sure you contact the agency if you find incorrect information on your report.
2) Make sure you are on the electoral roll, this let’s creditors know that you have a permanent residential address and that you are easily contactable. This seems simple but it is very important.
You will, of course, be paying council tax so contact your local council and ensure they register you on the electoral roll. Your regular council tax payments also help to ensure a positive credit record so make sure you keep up to date with payments.
3) If you have a poor record of payments on your file, for example, if you have consistently been late paying some of your regular bills, the most practical way to deal will this is to ensure all further payments from your account are made on time.
Use direct debits and standing orders to ensure you do not miss payments and they are all made in accordance with the schedule you have agreed. Alternatively, use a credit card more often and ensure it is paid off each month to demonstrate good financial management. Over time, this will show that you can be relied upon for repayments and this will improve your credit score.
Please note: if you have a County Court Judgment on your file, you will need to seek advice – the Citizens Advice Bureau should be able to provide you with information.