Get a healthy CREDIT SCORE

Editor of Themoneyedit.com Kalpana Fitzpatrick shares her tips on how to check, protect and improve your credit score

More than half of us have never checked our credit score*, and many people don’t realise it plays an important role in determining what financial products we have access to and how much we’ll need to pay for them. Whether you’re looking for a credit card, mortgage, store card, mobile phone contract or insurance, making your score as strong as possible can help you get the best deal. Read on to find out how to look after yours and ways you can improve it.

Why does your score matter?

When you apply for credit or financial products, such as a mortgage, the lender wants to check to see if it can trust you and that you’re a responsible borrower. To determine this, one of the things it looks at is your credit score. If your rating is low, you could be rejected or offered a poorer interest rate, which will cost you more in the long run.

Check your score

If you’ve never checked your score, then it is easy to track it down free at any one of the three main credit reference agencies (CRAS): Experian (experian.co.uk), Equifax (equifax.co.uk) and Transunion (transunion.co.uk). Each of the CRAS may hold different information about your financial history, known as a credit report, which they use to generate your score. With this in mind, it’s actually worth checking with all three agencies. Your score is a three-digit number and often colour-coded – usually green, amber or red. If it’s green, then your score is on the excellent end of the scale.

Make it better

If it turns out that your score is low or you want to improve it, then there are some really simple steps that will help:

Register to vote, so that you are on the electoral register. This tells the CRAS that you are who you say you are, and that your address is where you really live. If you move house, make sure your records are updated. You can register at gov.uk. Don’t miss any payments. Late or missed payments for bills and your mortgage will show up on your report and damage your score.

Check for inaccuracies. If you spot anything incorrect on your report, call the CRA and ask for it to be corrected.

Make any regular payments count

If you’re renting, make your payments count towards your score. Check out free schemes such as Rental Exchange (via Experian) or Credit Ladder (creditladder.co.uk) to help boost your score. If you subscribe to any services that involve regular payments, such as Netflix or Spotify, use Experian Boost free of charge to push up your score.

KLARNA REPORTS‘BUY NOW, PAY LATER’ TRANSACTIONS TO CREDIT REFERENCE AGENCIES,SO ALWAYS PAY ON TIME