Can your address affect your credit score?

Can your address affect your credit score?

author: Emily

By Emily

Wondering whether your home address really can affect your credit rating? Then here's all you need to know.


Your credit score can seriously impact the financial opportunities available to you in life. Having a good credit score can improve your chances of buying a home, starting a business or even getting a job, while a bad one can make it more difficult to achieve these goals – at least with an attractive price tag.

There are lots of factors that can affect your credit score, including the applications you make for credit, the age of your credit accounts, your debt and how much of your credit limit you use.

However, there are also plenty of myths surrounding these factors – such as whether your address can bring your credit score down. So how does your whereabouts really affect your credit score?

Your address confirms your identity

The UK’s three main Credit Reference Agencies use your personal information to help them build your credit report accurately. Your address is included in this as you’ll typically need a permanent address to get approved for credit.

It’s really important to make sure your accounts are registered under the same address to prevent any mistakes on your report. If you do move home, get in touch with your lenders or banks to update your address as mismatching details could be holding you back from being approved.

Your address doesn’t directly affect your credit score

Contrary to what some people think, where you choose to live doesn’t impact your credit score. Your credit score is used to rate your ability to handle credit, while your address is mainly used to confirm who you are.

Any rumours of an address blacklist are false – living in an undesirable area shouldn’t bring your score down, while moving to a more attractive area won’t bring it up either. Your score also won’t be impacted by whoever lived at your address before you.

Credit agencies like to see stability

However, while the whereabouts of your home isn’t a factor, moving regularly could flag up potential issues – like struggles to pay rent. Credit agencies and money lenders like stability as it suggests you’re settled and therefore more likely to be able to pay back your debt on time.

While it helps to be aware of this, moving home is recognised as a normal part of life and it’s unlikely that you’ll do it too often due to the hassle and cost involved.      

One easy way to make a good impression is to register for your local electoral roll. This helps credit reference agencies confirm your identity while also showing that you’re settled in the area you’re living in.

How your home can positively affect your finances

While your address doesn’t directly impact your credit score, there are ways that you can use your home to improve your personal finances.

Doing up your home is a great way to add value to it if you intend to sell it later down the line, while it can also be much cheaper than moving thanks to high house prices and stamp duty costs. Typical ways people improve their homes include building an extension, upgrading a kitchen or converting a loft.

Using your own cash to do up your home so isn’t always easy though, which makes investing in home improvements with a homeowner loan an option. If you do have a bad credit score, you’re more likely to be accepted for a homeowner loan as you’re offering your home as security to back you up.

Keeping up with repayments on a homeowner loan could also help to improve your credit score by proving you can pay back your debts on a consistent basis.    

Disclaimer: All information and links are correct at the time of publishing.

author: Emily

By Emily

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Can your address affect your credit score? Can your address affect your credit score?