To obtain your credit report(s) click on the image below. Try it FREE for 7 days, then £14.99 a month – cancel online any time

Your credit report is held by three main Credit Reference Agencies in the UK.
These are:

All financial institutions have an agreement whereby they feed information back to these three Credit Reference Agencies about your history of applying for credit and paying for credit. From this information, other lenders can decide what level of risk you present when you apply for credit with them.

What does my credit report contain?

Your credit report contains a number of items, the main ones being:

Credit scoring

Lenders often use credit scoring to decide whether to consider you for credit. It is important to note that the lender’s credit score is not the same as the credit score that you may see on your credit report. Each lender has their own way of scoring an applicant. To help your case, ensure your credit report is clean, accurate, and presented in the best way possible.

Blacklists

There is no such thing as a credit blacklist. All Credit Reference Agencies do is hold information about individuals taken from public records, lenders, or the individual themselves. If you are declined for credit by a financial institution that is a matter for them only and does not mean you are on a ‘blacklist’.

Credit searches and multiple applications for credit

Making several applications for credit over a short period of time may have an adverse effect on the response you get from lenders as these build up and shown on your credit report. When looking at alternate offerings you should ask for quotations rather than making applications. An application or assessment for credit will be entered on your credit file and this is known as a ‘footprint’. Some lenders offer credit scoring with what is known as a ‘soft footprint’. A soft footprint is visible only to the lender that places it on your credit file.
It is important to remember that your credit report can only be searched with your permission. You provide this permission when you apply for credit.
Credit Reference Agencies are regulated under the OFT Consumer Credit Act 1974 and 2006. They have a legal right to hold information about you. If you have a complaint about any Credit Reference Agency look on their website for information on their complaint handling procedures.

The electoral roll

Being on the electoral roll enables you to be registered to vote in elections. This is the easiest way for a lender to check your address history and confirm your name and address. Therefore, being on the electoral roll assists your credit rating.
In order to register on the electoral roll you need to be a British, Commonwealth, or European Citizen over 18. The Electoral Roll is updated by your local authority every autumn, although you can contact them at any time and ask for your record to be added or updated.

Aliases

Credit Reference Agencies keep details of any aliases under which they have a record of any credit given to you, or applied for by you.

Associations

An association is a link you have with someone of a financial nature. Associations are not registered between business partners but are concerned with joint accounts and joint applications. If you are no longer linked to an associate you may contact the Credit Reference Agencies and have your credit report updated.

Court judgements

If you have a court judgment on your credit record, it indicates you have been taken to court as you have not made payment on the money that you owe. Credit Reference Agencies obtain information on all people who have been taken to court for debt. If you believe a judgement has been wrongly recorded on your credit record you need to contact the court. Your credit record will show the case number of the relevant case.
If you pay any court judgement you can obtain a letter of satisfaction to prove it has been paid. A court judgment will remain on your credit record for six years even if you have paid it.

Bankruptcies

Bankruptcy information (known as Sequestrations in Scotland) is provided by the Insolvency Service to Credit Reference Agencies. At the end of your Bankruptcy order, or when you are discharged, Credit Reference Agencies are notified. If this does not happen you can obtain a copy of your discharge order from the Official Receiver and provide it to the reference agency. A Bankruptcy appears on your credit record for six years unless it is cancelled or annulled.
If you are the subject of a Bankruptcy Restriction Order, your Bankruptcy can stay on your file throughout that restriction order.

Voluntary Arrangement

If you are the subject of a formal voluntary arrangement from the court to pay off your debts, this information will be notified to the Credit Reference Agencies who will keep it on your credit record for up to six years.

Repossessions

Details of any property you have owned that has been repossessed.
In Scotland, the equivalent system of Trust Deeds is logged in the same way.

Main information on your credit account

All Lenders in the UK share information via Credit Reference Agencies. Your credit record shows details of every credit account you hold or have held in the past six years with information as to how much is outstanding, what the payment rate is set at, and your history of payments.

Credit Report Status Codes

Your Credit Reference Agency will typically use a status code to indicate what has happened with each account. If, for example, you have a credit card, your credit file will show payments over the last 36 months with a focus on the past 12 months’ payments. Payments monthly will be shown with a status code which shows if the payment has been made on time. A status code of ‘0’ under each month shows all payments have been made on time.

A status code of ‘1’ shows that a payment was one month late. If payment is not made the following month the status code is shown as 2.
Late payment status codes run up to 6 when they then revert to status 8.

Status 8

Status 8 on an account shows it to be in default.
A default means you did not keep to your credit agreement, and you have not responded to requests to bring your account up to date. A status 8 against one of your accounts on your credit report will make it difficult for you to arrange a mortgage with mainstream lenders.

Status D

Status ‘D’ indicates that an account is dormant and nothing is owed.

Status U

Status U means the lender cannot provide information on the account as it is newly set up or subject to dispute.

Status “?”

Status ‘?’ means the lender cannot provide information at this time.

Defaults

A default will stay on your credit report for six years after it has been registered.
We often have clients who believe that paying off a defaulted account removes the default from the report. This is not the case and those with a default on their credit report need to make their mortgage broker aware of this at the outset when applying for a mortgage as it will cause problems.

Notes on your account

You may see a variety of notes added to your account. Here are some of the common ones and what they mean.

Financial Associates

We often find clients concerned that their credit file has been damaged by them sharing an address with someone who has a poor credit record. This should not be the situation unless there is a case of mistaken identity. Another person is listed as a financial associate only if you have applied for credit together. A financial associate is typically a former partner or spouse.

One of the most common problems we see is where a relationship has broken down and one partner leaves credit in the hands of another partner to be repaid, but this has not happened. Where a credit agreement has your name on it, any failure to pay will reflect on your credit file regardless of any private agreement you may have with the other party.

Linked addresses

A linked address is an address to which you have had a financial connection in the past, perhaps using it to apply for credit. When you apply for a mortgage, a lender may query a linked address if it comes up on a credit report.

GAIN information

GAIN information is held on customers with debts who have moved home without providing a new address. For this reason, any GAIN information on a credit report is of concern to a potential lender.

CIFAS information

CIFAS is the UK’s fraud prevention service, CIFAS was set up to prevent people from having their names, addresses, or other details used by criminals to obtain goods, services, credit, or insurance. If there is a CIFAS note on your report this does not mean you are being accused of anything, but it is a matter of concern for a lender as there may have been suspicious activity on your record.

Notice of correction

A notice of correction is a note of up to 200 words on your credit file to clarify information. Credit reference agencies will only add notices of correction on your credit file if you can evidence there is good reason to do so.

Our main tips for improving your credit file

Step out the back Jack

Clients often ask if their ex-partner’s poor credit file can damage their own.

When you apply for credit in your own name only, the poor credit file of an ex-partner can affect your result if you are still ‘associated’. You are ‘associated’ if you have applied for credit together in the past.

If you are no longer associated with an ex-partner who has a poor credit file you should request ‘disassociation’ from that individual with the credit reference agencies. It is quite easy to do, for example, Experian has a financial disassociation questionnaire online that you can use to do this.

Finally

Your credit report and its condition greatly affect your ability to obtain credit and the rate you pay for it. Take some time and ensure it is in the best state possible.

The post How to check your credit report appeared first on A Mortgage Now.

If your mortgage broker believes there could be information on your credit file affecting your ability to secure a mortgage, they will ask you to obtain a copy of your credit report.

What does this mean?

Your broker is requesting an up-to-date copy of your full credit report and this is available via companies such as Experian, Equifax, and TransUnion. Ideally, you should obtain reports from all three sources as the data on them sometimes differs.

You have the statutory right to access your personal credit information, and a credit agency is permitted under the Data Protection Act 1998 to charge you £2 for providing your statutory credit report.

CheckmyFile

The easy route.

CheckmyFile provides a subscription service that allows you to download your credit report online within minutes.
The service is £14.99 per month and gives you access, through on report to your credit files from the three major UK credit reference agencies Equifax, Experian, and TransUnion.

CheckmyFile offers you your first month’s subscription for free to trial the service. If you cancel in the first month you pay nothing.

How to download your credit report from checkmyfile

Credit reports from the 3 main UK Providers

Equifax

Instructions to obtain your credit report from Equifax here.

Experian

Obtain your Experian credit report here.

TransUnion* (Credit Karma)

For instructions on how to obtain your statutory credit report from TransUnion click here.

*Formerly Call Credit (Noddle)

Do not email your credit report to anyone!

Normal emails can be easily intercepted, and your credit file contains all the information needed for identity theft.

We have a secure upload facility so that you can upload your credit report to us safely and securely.

The post Obtaining your Statutory Credit Report appeared first on A Mortgage Now.

In the UK, there are three major credit reference agencies supplying mortgage lenders with the information they require to make lending decisions on applicants.

These credit agencies gather data from financial services companies every time you take a loan, arrange a credit card, or apply for a financial services product. Data is normally held on file covering six years.

The information held includes addresses from which you made applications, how much you have borrowed, what the payments were, and whether you paid those payments on time.

Your record will contain details of anyone you are, or have been, financially associated with.

Credit reference agencies will give you access to your credit file if requested.

View our video – Mortgage Credit Score

Understanding your credit file

Your file may show a rating in the form of a number. Whilst many clients feel this rating number can guarantee them a mortgage, this is not the case.

The score on your credit file or even the condition of your credit file does not dictate whether a particular lender will advance you a mortgage.

It is important therefore to understand how lenders’ credit scoring differs from credit rating.

Understanding credit score

Most lenders, when considering you for a mortgage, put together a credit score where they will give you a certain number of points for each aspect of your application, for example, the higher your level of deposit, the more points you might get.

The higher your personal income is compared to the loan you want, the more points that may be available.

The better your financial history, again, the more points that may be available.

You could also get points for your age and your occupation, you will be point-rated on your financial liabilities, the size of your family, and whether or not your spouse is working. All these points go together to create a financial decision from the lender.

With many lenders, the credit score cannot be overridden and if you do not pass the credit score, they will simply not lend and there is no appeal to this.

How lenders generate scores and what points are gained for, each aspect of your profile is information that lenders keep confidential.

If you are applying for a mortgage, one factor that can work against you is if the lender sees a number of other credit references applied to your record over a short period of time, in other words, evidence that you are shopping around.

A client shopping around suggests to a lender that there may be issues in obtaining a mortgage and this could lead to a decline.

We always recommend that you only deal with one independent mortgage broker at a time, avoiding unnecessary credit scores on your record.

To keep your credit file clean, always ensure that any financial liabilities you have are paid regularly and within the terms and conditions of the arrangement.

Where possible, put payments on direct debit mandates and be particularly careful with mobile telephone accounts which are often missed and cause a problem.

It is sensible to make payments early in the month so that if something is missed, you still have the opportunity to make the payment before the end of the month.

The simplest and smoothest way to obtain a mortgage is to use the services of an independent mortgage broker.

The post Mortgage credit score appeared first on A Mortgage Now.