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Loans are hard to get if your credit score isn’t perfect. Many of the best credit card deals that we mention are also not available to you if you don’t have the best credit record. But fear not! Even if you have a credit record that makes you want to weep, there are ways of cleaning it up over time.
If you’re not, write to your local council who will send you the registration form. You can opt out of the public register for free, which means people can’t openly access your information. The private electoral roll is only used by public agencies like your local council.
If you cannot do this, contact the supplier, credit card provider, or bank as soon as possible to discuss what options are available to you. You may be able to change your repayment schedule, or make a minimum repayment instead.
Check your credit record through the credit reference agencies like Experian. Make a note of any unusual activity that you don’t recognise and contact the credit agencies to investigate. Most importantly, check for County Court Judgements (CCJs). These can be issued and missed if you’ve recently moved house, for example, and didn’t receive the summons. It’s really detrimental to your score, so resolve this as soon as you can.
If you’ve paid off your debts or have been discharged from your bankruptcy, check your record with Experian, TransUnion (formerly Call Credit), and Equifax. Settled or discharged debts can take up to four months to show on your record – if they aren’t listed after that time, contact the credit agencies and the lender.
Any line of credit – even a mobile phone bill – that you’ve paid off should show as closed and settled on your credit record. If it’s not showing as settled – or worse, as a default – contact the lender or organisation immediately to sort it.
Companies such as *Creditspring offer affordable ways to borrow and increase your credit score. Whilst rebuilding credit score can seem complicated, Creditspring offer a set repayment plan (much like a subscription), with each repayment made on time increasing your score.
Tenants can use Credit Ladder to prove they’re responsible to lenders. It’s a free service for tenants to use, too. You pay your monthly rent via Credit Ladder. They report each month to credit reference agencies that your rent – a large sum – has been repaid in full, on time. Over time, this rebuilds your score as a responsible spender.
Similar to using your rent – an everyday expense – to rebuild your credit, you can use small savings to help, too. A credit improver service like Loqbox gives you a small loan. You don’t get the cash, though! It’s locked into an account for you. Every month, you make agreed ‘repayments’ to this loan. At the end of it, the money you paid is released into a new bank account for you. It’s a great two-fer: you get to rebuild your credit score AND finish up with savings!
If you’re rejected for any type of credit or bank account, STOP! Research your credit record with each of the three credit reference agencies. Don’t just keep applying, assuming you made a mistake on the form. Multiple rejections in a short space of time can take YEARS to knock off your credit record – so avoid it at all costs!
If you’re already spiralling into debt, don’t apply for credit. Especially avoid things like payday loans – they’re expensive and look really bad to lenders looking at your credit record. Instead, take a deep breath and seek help.
Contact the National Debtline or Stepchange to talk through your finances and set up a repayment plan. You can also look up your local Community Money Advice centre for help, too. Jasmine is a patron of this financial education charity: they’ll help you manage your debts and finances and help you get back on track.
Chat to Experian and they can tell you more about their services.
To learn more about how to clean your credit report, read on.