Tips To Help Your Credit Score

Getting Through a Credit Score

Passing a credit score is the first hurdle that must be crossed when applying for a new mortgage and failure to get through this stage is a big problem.  Every lender has their own way of credit scoring and they take in to account many different factors to give them an overall picture of your risk profile.

To give you the best chance of securing the most competitive rates it is vital that you can get through this first stage of the mortgage application process.  Below are 6 tips on how to increase you're chances prior to applying for a mortgage.


1  Check Your Own Credit Report

The two most popular credit reference agencies are Experian and Equifax.  Most mainstream lenders will use one of these when running a credit score on you and for the cost of £2 you can order you own report and see the same information a lender will see when you apply for a mortgage.

Make sure all the information is correct and if there are any errors get these corrected before you start your mortgage search.  Lenders will particularly be looking out for late payments, defaults, county court judgements and the number of previous credit searches.  All of these can have an effect on your ability to secure the best mortgage rates.


2   Make Sure You Are On The Electoral Roll

This is one of the easiest, and most important, ways to help boost your chances of passing a credit score.  It helps the lenders confirm your identity and address history scoring you some well earned points.  You can check  with your local council that you are on the register and that all the information is correct.


3   Make Sure Your Bank, And Credit Accounts, Are Linked To Your Current Address

This helps a lender build a picture of your financial history so a well conducted bank account and credit payment history will help your chances.


4   Do Not Do Too Many Credit Applications

Your credit file will record how many previous credit applications you have made and you need to keep this to a minimum.  If a lender can see you have applied to multiple companies in a short space of time it can raise a red flag.  Even applying for certain insurances can involve a credit check so be careful not to over do it.

This also applies to doing an agreement in principle with a mortgage lender as most companies still leave a hard footprint on your file.


5   Pay Your Bills On Time

This is vital if you want to be able to secure the best mortgage rates.  In recent times even one or two late payments on any form of credit can result in a decline.  If you use credit cards make sure you pay at least the minimum monthly payment on time.  It is sensible to set up a direct debit to make sure you don't miss a payment.

Avoid going over your overdraft limit on any bank accounts and pay any mobile phone, or utility bills, on time. 


6   Having No History Of Credit Is A Big Minus

If you are a first time buyer and you have never had any form of credit it can be difficult to pass a credit score.  Although you would think it is very sensible way to run your finances the lenders can't get a picture of your financial history.  It is a good idea to get a credit card and spend a minimal amount on it each month before clearing the balance when it is due.


If you fail one lenders credit score it does not necessarily mean to can't get a mortgage.  All companies have their own way of assessing your risk and some are stricter than others.  Contact us for advice prior to making an applications and will do our best to make the process as painless as possible.


Your home may be repossessed if you do not keep up repayments on a mortgage


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