Articles & News About Your Credit

My Credit Rating Is Poor - How Can I Improve It?

When looking to borrow money, all companies will want to know a little bit about your credit history before they decide to do business with you ? it?s the norm when two companies deal with one another for them to check each other out first, but for the man on the street it may seem a bit odd. Well it?s all about balancing risk. Before a bank will lend you any money, they want to work out how likely you are to pay them back. If all their customers always paid their loans back on time, there would be no risk, but they don?t! Some people miss a few repayments & some never pay back their loan at all. So the banks do some advance checking and it?s semi-automated to speed things up ? here?s where your credit rating or credit history come into effect. Once the bank for example has seen your rating they can decide with more confidence if and how to do business with you.

Is it important? Why? Your credit rating is important for various reasons ? first of all it may be bad enough to stop you getting a loan at all ? or more normally, a poor rating will mean that any loan or mortgage you are offered is more expensive, to cover some of the increased risk. So a good credit rating means cheaper loans and mortgages ? that?s fairly important I?d say!

What is Credit Scoring ? how is that different? Credit Scoring is a more general term ? some companies have their own systems to rate new or existing customers. They may use a combination of credit reference agency information and the information they hold themselves ? perhaps from your application form for example.

How is a credit score worked out? There is no official credit score as such ? although Experian have developed something called the National Credit Score which runs from 0 to 1000 and can be accessed for a fee ? Credit reference agencies provide a mix of information about you to the companies that use their service and those companies use that information as they see fit to base their decisions on. So you don?t have an official credit score, only a report containing various bits of information.

Who keeps the records and how are they accessed? There are two main organisations that maintain the credit ratings for the UK population ? Equifax and Experian. They keep all this information and provide it,at a cost,to organisations who may wish to see it and also to the individuals themselves who may wish to check their own record.

Can I see my own rating? Yes of course ? legally these companies have to make available to you any personal information they may hold ? part of the Data Protection legislation I suppose ? but they are allowed to charge a small administration fee for letting you see it ? sounds crazy but true.

You can sign up to other services, for example paying a monthly fee to have ongoing access to your record, or even a text alert system that will send a message to you, if anything significant changes on your record ? this can be useful for fraud detection.

Another company, CallCredit, offers a one-off online view of your own record for ?8.95.

Can anyone see my rating? No, only certain companies have access to the information and they are carefully screened. They may also be obliged to contribute information back to the system. Also they would be expected to outline exactly why the need to see this information and what they will use it for.

How will a good credit rating help me? There are two ways of looking at this - the benefit of having a good rating and the downside of having a poor one. Let?s take the downside first ? having a bad rating can affect your ability to get a loan or a mortgage ? a bad rating may stop you getting one full stop ? normally the impact is that the interest rate you may be offered on a loan will increase as your rating goes down ? the lender of the money is balancing the risk of getting their money back against the amount of money they will make from providing the loan/mortgage.

People with good credit ratings are seen as less risky and therefore the kind of person a bank or lender would like to be lending money to. In a competitive market everybody wants that type of customer, so they will be offered lower rates of interest to attract them ? the lowest rate personal loans for example, will only be offered to people with clean ratings.

Is there anything I can do about getting a good rating? There are some fairly basic things you can do easily and some things that maybe more difficult for you. First off make sure you are on the electoral roll.This is so that companies can verify your address. Next make sure you don?t miss any repayments on any mortgage, loans or credit cards. For credit cards just paying the minimum amount will make a difference ? you need to be seen as a reliable repayer if companies are going to be happy to lend to you.

Some people who have never had a loan or credit card may not have a great credit rating, because there?s no history of how good they are at repaying. Obvious really!

What if the Credit Reference Agency have got something wrong? If there is something on your credit record that is incorrect you can apply to have it corrected. There are different ways of doing this. If for example some information about a loan or account is incorrect you can contact the bank or lender directly to have it amended or contact the credit reference agency and ask them to do it for you. You can also ask for a note to be added to your record to help explain something ? called a Notice of Correction ? this will also be sent to any company that may have accessed your record recently.

Is there anything else to worry about? There are other factors that will influence things like the rate of interest you may be offered on a loan ? are you employed or self-employed ? self-employed people are seen as higher risk. Do you have printed payslips from your employer? - handwritten or no payslips are viewed with caution. Do you own your own home and if so how long have you lived there ? the longer the better. Does anyone else share the home with you? Are they financially linked to you and if so what is their credit rating? Wow it?s getting complicated now! ? Bottom line is it?s all about balancing risk ? companies are using all this information to help them decide how risky it is going to be to lend you money or to give you credit on a card. More risk equals less likely to repay and therefore more expensive ? you have been warned!

One more thing Everytime your credit report is accessed it is recorded on the record itself - they call it a footprint ? so a company looking at your record can see how many other companies have seen it recently. If there have been a high number of searches on your record they may see this as a bad thing. But no searches can also be a worry to them. The fact that your information is accessed shouldn?t normally be a surprise to you, as a company should ask for your permission before checking your record. Although many don?t make this obvious, it should be in their general terms and conditions. Shop around by all means, but keep a close eye on how many credit searches are being carried out ? normally a search should only be carried out if you have made a proper application not just an initial enquiry.

Marcus Brooks writes guidance for the loans websites http://www.quick-decision.co.uk and http://www.cheap-rate-loans.co.uk which both offer quick decisions on cheap rate loans.

Other Article Sites

findabook.com  moneycd.info  a-mortgage.info   about-lemon-laws.info  aboutstudentloans.info
all-about-publishing.info  auctions-articles.info  bestcollege-university.com  bestispconnection.com
biblefolder.com  blogger-website.com  books-used.info  brokers-guide.info  buywindows.info  cable-dsl.info
career-miner.com  carpel-tunnel.info  cashinaflash.info  cashloanreviews.info  casinobell.com  chat-house.info
clearmycredit.info  collegeloantips.info  crones.info  depression-articles.info   dirnic.net  dishguides.info
divers-below.com  expodog.info   financewizz.com  fire-insurance.info  getgood.info  handleit.net   it-idea.info
health-supplies.info  hosting-right.com  insidealert.com  insurance-facts.info  jobs-employment.info
justgood.info  lookgold.net   lowcost-travel.info  money-source.info  myhostzone.info  numisblog.com
peoplesearchfinder.info  pr-articles.info  realeas.com   refinancing-guides.info  spyware-remove.info
telelot.info  the-law.info   toppaid.info  travel-deals.info  travelcorrect.com  wedding-guide-site.com
your-blog.info  your-credit.info

One Month of Mojo, Applied to Credit Cards
CreditCardsMojo.com celebrates one month of successfully distributing the best and the latest from the world of credit cards.

Avoiding Your Credit Card's Universal Default Rate
Many consumers at least have some understanding that their credit report score affects what sort of credit cards they may be eligible for because the level of their credit determines the levels of credit card interest rates Yet, there is something that is not so widely known

Credit Establishment 101
There will come a day when you need credit. You may want to buy a home or a car and your credit rating will become very important to help make these dreams come true.

As the Credit Crunch Tightens, "Bad Credit Loans" Offer a Positive Solution
Credit problems are increasing dramatically both in the UK and abroad, explains Andy Hygate from www.loansbadcredit.org.uk.

A Strong Gpa Is Good, But Fico Is Great: Case For Credit Card Education For College Students
At Junior credit cards, we believe credit is such an important issue that depending on how you manage it, it can make or break your financial life To make credit work for you, it is essential that you understand your own credit and what your credit information says about you to the growing number of companies that use credit information to make life impacting decisions about you

Choosing The Right Credit Card
Look in any mailbox and you will see several credit card companies offering the chance to apply for their fantastic credit card. Credit cards are big business and today most people have and use more than just one. However it is important to choose which type of credit card is right for you, here are some tips.

Get rid of late/overlimit/interest fees with pre-paid credit card.
The pre-paid credit card is the best kind of credit card to have, if you have bad credit history or don't have it yet. Many people today can't get approved for a credit card and since you need them for most anything like shopping online or renting a car, this is the perfect solution, or is it?

Update Your Computer System With Bad Credit Computer Financing
The moment I placed myself in front of the computer screen a whole new world beckoned me to join it. And years of strolling have proved incompetent to get me acquainted with the full panorama of computers.

Bad Credit Loans: The Multiple Debt Solution
When you find yourself mired down in debt and sinking faster than you ever thought possible, you should consider a bad credit debt consolidation. This type of loan allows you to consolidate bills into one monthly payment. It is useful if you have multiple credit and store cards that are maxed at, as well as other loans on cars and a possible mortgage.

Apply Online For A Credit Card In Canada
If you are an American living in Canada, you have to consider that owning a credit card is essential in your everyday life, you may not always have the money to cover your expenses and the card will come in extremely handy. With it, you will be able to make purchases even if you still don?t have the money to pay for your purchases. This will mean that you will be able to purchase all the things you need in your everyday life with a credit card and pay it back later on a monthly basis.

Three Common Credit Problems And How To Fix Them
Bad credit doesn't necessarily mean you can't get credit; you just can't get credit at a reasonable cost. The interest rates you are charged are sky high because you had some financial difficulties in the past. In this article we will give you three methods for repairing your credit. The method that is best for you will depend on the severity of your financial problems.

How To Eliminate Credit Card Debt
There is almost nothing more troublesome than having too much debt to pay each month. Consumers incur debt for many different reasons.

Bad Credit Credit Cards
We live in the world of credit. Most of the banking institutions offer different forms of credit from credit card to signature loans. Majority of people often find themselves in bad credit situations like court judgment, bankruptcy, reposssesion, foreclosure and loan default,due to lack of enough financial knowledge and discipline which often make it difficult for them to get any credit at all in future. So - what exactly is credit?

5 Best Credit Repair Tips Will Fix Your Credit Report And Score Now!
Today having good credit reflected in your credit report is important in every financial situation you find yourself in as you probably know and knowing a few tips about credit repair can solve a lot of your credit problems. In our world credit determines just how much interest you'll end up paying on your house, car, truck, etc.