We hear a lot about poor and good credit and what is good and bad but it can hard to know whether what we are hearing is right and whether it will make that much of a difference to us personally. It is worth knowing a bit about credit records though because it could be important for you.
What is a Credit Record?
A credit record shows our financial history. There are several companies that keep track of this information and hold the data. You can look at your own credit record, free of charge, by registering with one of the companies. It can be interesting to take a look at it as it will give you an idea of what sort of information is noted and also you can check to make sure that it is correct. You will see that it has records of any loans and overdrafts that you have and any missed repayments. It also has records of bills that have your name on and any missed payments on those as well. There is also information about you bank and credit card accounts and details of anyone you are financially linked to due to taking out joint accounts with them. There will also be details of any CCJ’s, house repossessions, bankruptcies, fraud or IVAs in the last six years.
Who Uses Credit Records?
There are different people that might be interested in looking at your credit report. Employers and landlords will look at them to check identity by way of the electoral role information but they will also look at insolvency records and CCK’s and this may impact whether they take on or not. Lenders will look at a lot more details than just this. They will want to make sure that you will be able to make the payments on the loan that you are applying for. Therefore, they look for evidence of this on the credit report. It is difficult to know exactly what they are looking for as they all differ but, you want to impress them. They will want to see that you can be relied upon and they will want to make sure that you will be able to repay the loan. However, they each have their own way of judging what will be good and this means it is not always easy to do the right thing to please everyone.
So, if you want to get a new job, rent a new property or borrow money then you will need to have a decent credit record. Therefore, you will need to try to improve it before doing these things if you think that it will mean that you will get turned down. Try not to worry about it but think about what you might be able to do to improve things. Make sure the details are correct and then try to repay loans and make sure you pay everything on time. This will improve your record and should help you to be able to get the job, home or loan that you need in the future. It will take time to build it up, but do not worry about it but just make sure that you star on track with these things. It can be helpful for you personally as well because if you repay loans you will save money in interest, you will owe less money and you will not have to pay any late payment charges. You may also have to learn a bit about how to manage your money better or budget which is always a very useful thing to learn.