Why are we never taught about credit rating scores?explains: “A credit rating is an indication of how a typical lender would assess you. When you apply for credit, each lender tries to predict your future behaviour based on the way you’ve acted in the past. To do it, they look at lots of different data. This may include how many applications you’ve made recently, how much you owe, what credit products you’ve had and whether you paid them all off on time.
“It usually means that you are human and have made some mistakes in the past and not managed the credit you have been leant in the best way possible,” she says. “You may assume you have a ‘bad’ credit score if you apply for a form of credit – a mortgage, car loan or mobile phone contract – and are denied, because of something on your credit report and score. Essentially your credit score is not at the level you need it to be to do the thing you want.
“The first thing to know is that having a ‘bad’ credit score does not mean you’re a terrible person who’s bad at maths and rubbish with money…”, adds: “Missed or late payments, bankruptcies and County Court Judgements stay on your file for at least six years. It doesn’t mean you won’t be able to get any credit over that period but it will be more difficult and more than likely at a higher rate of interest, especially if you’re made or declared bankrupt or have CCJs.
Now that we have a clearer idea on what a credit score is judged on, Flavius shares her top tips on what can we actually do to improve it:Do not miss payments – if you anticipate that you will be delayed with a payment, speak to your creditor, let them know what is going on, they may be able to help.
What I’d like to know is how I have a perfect Experian score but a well below National average clear score. How can they be so different Is it my monzo account