How your score is calculated
You can apply to view your credit score through websites such as Experian, Clearscore or CredAbility. You can see your Equifax credit report free (for life) through our member-only platform, CredAbility. Plus, you can check it as many times as you like, without leaving a footprint.
These types of sites will often give you a free credit report after you provide them with your details. They will often collect their data from a credit bureau such as Equifax or TransUnion. To get an accurate report, you’ll need to provide information such as:
- your previous address history (up to 3 years)
- your marital status
- annual income
- if you have any dependents
- if you have a mortgage.
When you provide this information, you receive a score based on your financial history, especially borrowing and repaying. Lenders use this to check whether you’d be a suitable candidate to fit their borrowing profile.
The better your credit rating, the more likely it is that you’ll be approved for the loans or credit cards that you apply for.
When a lender is trying to make a decision on your credit application, most will check:
- whether you have made all previous repayments on time
- if you have any unpaid debts
- if you have a substantial credit history.
Credit reference agency scores
Different companies will have different credit ranges. If you want a ‘good’ score you’ll need to get the following:
- Equifax- 660 or above
- Experian- 700 or above
- Transunion- Between 661 and 700
Generally speaking, the higher your score, the better. Each credit bureau will have its own range so the thresholds between bad, good, and excellent will vary depending on who is checking your score.
If you do check your credit score with various bureaus, then it's possible to get an average score from one and an excellent score from another. This might be because one has different or incorrect information about you. If that’s the case, then you should check that they both have the correct information.
Getting approved for a loan or credit card
Just because you have a good credit score, it doesn’t necessarily mean you are guaranteed to be accepted. This is because it depends on what you’re applying for. Borrowing profiles will differ depending on the lender.
They will consider the information given on your credit report, as well as your income and your expenditure. So, if you’re applying for a mortgage and you have a great credit score, they may still turn you down if they don’t think your income is enough to support your repayments.
What can damage your credit score?
Things that could affect your credit history include:
- missing payments
- making a late payment
- receiving a CCJ (county court judgement)
- using too much credit
- little to no financial history
- rejections for previous credit applications
- applying for a lot of credit in a short space of time.
In particular, missing payments or making a late payment can show up on your credit history for up to six years, which reduces your chances of being able to take out further credit.
If you don’t have a good credit score at the moment, you can do several things to improve it and increase your chances of being able to borrow in the future.
Improve your credit rating with Ocean Finance
- Up to £1,500 credit limit
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Intelligent Lending Ltd (credit broker). Capital One is the exclusive lender.