There was time when you could confront a Lender with a ‘squeaky clean’ past, utility bills would be proof of residence and your bank account status and previous loan history would be enough to reassure the Lender that you were an honourable prospect.
Those days are gone forever; Innocents are now branded by the Credit Score companies.
Having an Investment aspiration; a new house, Business venture a new job even, is no longer enough. You’ve probably heard it said ‘want something enough..go for it’
NOT SO, nowadays you have to hop the Credit Score hurdle first.
We are no longer judged by what we have done right, rather what we have done wrong or in some case what we have failed to do.
Thinking of yourself as a ‘good credit risk’ with honest knowledge that you have always played by the rules is a mistake. Simply put you are deluded.
If you are applying for a job in Financial Services, a Store or Credit Card, opening a Bank Account or considering a Loan or Mortgage application be warned. Your Credit Score/Report will be accessed as a matter of course. If you don’t make the grade……FACT you will not get that job, credit card, loan, mortgage get the picture. It hurts.
• Get a copy of your Credit Report (and remember its updated regularly so will be out of date within a matter of months).
• Check it for errors. If there are errors and, believe me it’s more common than you might like to think. Work on getting them corrected. It’s not fair I know and, you will have to provide proof which can be a frustrating process. Persevere it will pay dividends in the end.
Remember this document could be and often is the deciding factor that determines what happens next in your life.
So what can you do?
1. If your Credit Report says you are not on the Electoral Role then get on it immediately. Contact the Electoral Office in your area and ask for the application form and/or ask them to send you a letter confirming that you are on the role. It may take time but it’s worth it. You can then get The Credit Report Company to change your file. Lenders always ask how long you have lived at your current address; they prefer permanence it’s understandable. While your application wouldn’t be turned down on the basis of the Electoral Role it’s just one of the factors that can damage your overall Credit Score.
2. Don’t be late with Credit/Store card payments. Set up a monthly Direct Debit to pay off at least the minimum payment every month. If you are late it will be recorded on your Credit Report, while once is acceptable twice is not, it will affect your Credit Score and will trigger an Amber alert on your record, which could then take months to drop off.
3. The same applies if you are late with loan or Mortgage payments; if you think you may be unable to make a repayment on time contact the Lender before the event occurs. They may allow some leeway which will buy you time and save your reputation. (obviously this won’t work if you demonstrate it as a habit) To reiterate, ALWAYS CONTACT THE LENDER. If it was your money you would want to know what was happening.
4. Not having Credit Cards or a history of Credit can be as bad as having too much or paying late. Having Credit Cards and not using them will also do you no service. The best strategy is to have at least one Credit Card in your own name, use it periodically and always pay at least the minimum each month.
5. Do Not apply for Credit until you know you have a ‘Good Credit Score’ (company sites for example Experian or Equifax will explain what this is), every unsuccessful application you make for Credit will effectively reduce your score and compound the possibility of being rejected. Individuals who apply for Credit repeatedly will be considered a poor risk by Lenders as it indicates that other Lenders have rejected them.
Dream of that Investment by all means BUT..
Before you do anything, sort out your Credit Score or be Damned alternatively join thousands of people who are spiralling towards a black hole of rejection.
Like it or not we are stuck with the system.
There are plenty on companies on the web that will take your money for the report, do your research and choose one that gives the service you require.