How to Improve Your Credit Score from Average to Excellent
How to Improve Your Credit Score in the UK – as the first step of credit repair, review all three main UK consumer reporting agencies’ reports to identify any errors or indicators of fraud. Furthermore, registering on electoral roll will improve your score by making it simpler for lenders to verify your identity.
Paying your bills on time
Paying your bills on time is crucial if you want to build up a positive UK credit history and score. Lenders utilise credit reference agencies (CRAs) as a way of verifying your past debts and deciding whether you are considered a good risk by lenders.
Payment history accounts for the bulk of your credit score and late payments should always be avoided. An exceptional score will enable you to find the best offers on mortgages, mobile phone contracts and electricity tariffs.
An outstanding UK credit score can make all the difference when applying for mortgages or utilities with competitive rates. While there is no quick solution, following these simple tips can help improve your score over time. In addition, it is crucial that you monitor and correct any inaccurate or misleading information on your UK credit report regularly by visiting Experian and Equifax regularly.
Opening a bank account
Enhancing your credit score in the UK involves many methods, such as opening a bank account. Doing this can reduce outstanding debt and build credit score; additionally registering on electoral rolls provides lenders with consistent address history necessary for anti-money laundering checks.
Try to limit the number of credit applications you submit. Each time you apply for credit, a hard search is conducted on your file which could potentially hurt your score. Instead, request soft searches, which won’t leave a footprint behind on your report.
An excellent credit score is essential for many reasons, from being approved for a mortgage loan to receiving discounted utility rates. Furthermore, having good credit may even increase your employment prospects or help secure you an apartment rental.
Taking out a credit card
Credit cards can help improve your credit score when used responsibly. Aim to pay more than the minimum each month and maintain a low utilisation rate; free online repayment calculators can show how long it will take for different payment levels to clear off balances.
Lenders prefer borrowers with long credit histories. You can lengthen yours by keeping older accounts open and forgoing new lines of credit applications. Furthermore, closing any unused accounts as this will lower the average account age and ultimately affect your score negatively.
Raising your UK credit score may seem challenging at first, especially if it is your first time borrowing money. By following the tips above and working to increase your score, you will soon find yourself on track towards improving it and having access to loans, mortgages and utilities at any time.
Applying for a mortgage
An excellent credit rating can make accessing mortgages, loans and credit cards at more favorable rates easier. It can also make getting store cards, mobile phone contracts or TV subscriptions simpler. You can improve your score by being on electoral roll, paying bills on time and limiting debit balances.
When applying for credit, lenders often check your credit report to assess how well you manage money. They may also access bank accounts to determine your ability to repay them back. Usually using hard searches which leave a lasting imprint on your file, visible to other lenders, although soft searches might also be available which won’t negatively affect your score.
Depending on where you come from, transferring your credit history from other countries may take some time. There are ways you can speed up this process though, including setting up direct debits and avoiding overdrafts.
There is quite a good Which? report that goes into more detail on How to Improve Your Credit Score.
