You and your Credit File – How to Improve and Maintain a Good Score

Published: 24/04/2018

Have you been looking round at rental properties in Fulham? If you have then you’ll already know that there are documents, you need to produce to a prospective landlord. This is because landlords need to know that their tenants are responsible individuals. And, that they have enough money to pay the rent each month.

One of things a landlord may do is to check your credit file. That’s why it’s important to keep an eye on it, especially if you do want to rent a property now or get a mortgage in the future.

A potential landlord can apply to see your credit file from one of the three main agencies. These are Experian, Callcredit and Equifax.

A landlord won’t be able to see how much credit you already have. But, they will be able to see credit references, county court judgments or bankruptcy records. They will also see your credit score.

Each agency has a different method of working out the score. It is a number and lower numbers mean a poor credit rating. You can check you own rating by sending off for your credit file. Callcredit will send you your credit score free of charge. Experian and Equifax charge £2.

Your credit score will be high if you have credit and you have dealt with it responsibly. This means you have made your payments on time and you have never missed a payment. A low credit score doesn’t necessarily mean you are bad with money. If you don’t have any credit, then you will not have built up a score.

If you want to start building up your credit file, then there are several ways you can do so. Firstly, if you can vote in the UK then put yourself on the voters register. This means a landlord can easily check where you live.

Secondly, put your mobile phone or any other small credit agreements in your own name. (They may have been in your parent’s name if you are still living at home). Finally, you can get a credit card. Make sure it has a low limit. Use it to make the regular purchases you normally spend your money on each month. This could be food or petrol. Pay it back on time and in full each month and you will be able to see your credit score going up.

Do you want the rent you pay to be included in your credit file? You can apply (with the landlord’s or letting agent’s permission) to Credit ladder. This is run in partnership with Experian. You pay your rent into credit ladder each month. They pass it on to your landlord and then verify the payment on your Experian file. This builds up your credit score and could help you in the future if you decide to take out a mortgage.

Don’t be tempted to apply for more than one loan at a time if you are looking for credit. Loan applications leave a footprint in your credit file and multiple applications will the impression that you are short of money. Or, you are not handling your finances correctly.

When you get your credit file, if you see something on it which isn’t correct, write to the credit agency to put it right.

A potential landlord will be more inclined to rent their property to someone with a good credit score. This demonstrates you are responsible with your finances and therefore a good risk.