Considering applying for a loan, credit card, broadband or mobile phone contract? Nine times out of ten, your credit rating is crucial to whether or not you’re approved for the service. Having a good credit score increases your eligibility for finance and helps you to secure the very best deal.
But please don’t panic if your rating isn’t currently as good as it could be! No matter how poor your credit history, there is always a way to improve it. Lucky for you, we’re here to help you flip the switch from bad credit to good credit! Here are 4 quick and easy ways to raise your credit score:
1. Sign Up To The Electoral Register
As well as giving you the right to vote in public elections, signing up to the electoral register will also improve your credit rating. All you have to do is visit online here and input your:
- Date of Birth
A financial provider can then refer to the register to ensure that the details listed corroborate with the information given in your application. If the lender can be certain that you are exactly who you claim to be, they’re much more likely to grant you a loan or any other financial service that you require. It takes minimal-effort to register and the improvement to your credit rating could be enough to secure you the finance you deserve.
2. Reassess Unused Credit Cards Or Store Cards
Many people don’t realise this, but having lots of unused, available credit can negatively impact your overall credit rating. So, if you have multiple unused store cards or credit cards, you may want to think about cancelling some of them to lower your available credit limit and push up your score.
Alternatively, you could also look to use your available credit more efficiently. For example, you could transfer some of your debt onto one of the unused cards (providing that the card in question has a lower interest rate than that which you’re currently paying of course). This will show that you are making better use of your credit and could improve your overall rating.
3. Double-Check Your Credit Report For Any Mistakes
Errors on your credit report can really affect your credit score and hinder future applications for finance. The credit agencies don’t always get it right, so it’s really important that you regularly check for mistakes.
You can access your report online using Equifax, Experian or Callcredit for just £2. Alternatively, you can sign up for a free 30-day trial. Just remember to cancel your subscription before the end of the month to avoid being charged! It’s also advisable to check your report with all three agencies as each one holds slightly different information, and you don’t want to miss any vital mistakes.
If you do spot any errors, you can contact the credit referencing agency directly and raise a dispute with them or you can complain to the Financial Ombudsman who will ensure that mistakes are corrected. So, go grab yourself a highlighter and spend an hour or two combing through your credit file – it could save you a lot of hassle in the future!
Top Errors To Look Out For:
- Check that any negative credit history dating back further than 6 years has been erased. Your file should automatically be wiped every 6 years, so any history that is still showing from before this date needs to be removed.
- Ensure that all of your open accounts are listed with the correct address. Having an old or incorrect address associated with an open account can cause problems for lenders when they try to verify your identity.
- Look out for accounts that you didn’t open. You could have been a victim of identity theft or the credit agency may have received misinformation.
4. Consider Using A Credit Rebuild Card
If used sensibly, a credit rebuild card is a great way to raise poor credit. It can also prove useful for building up a credit history if you have a thin credit file. Simply use the card to pay for a reasonably small purchase once a month, between £30 - £60, and repay the amount in full by the date specified. If you do this consistently throughout the year, you will demonstrate to the credit agencies that you are a reliable borrower and your credit score should improve.
Before applying directly, you should check your chances of qualifying using Money Saving Expert’s free eligibility calculator and take note that:
- You should never use the card to withdraw physical cash
- The APR is usually very high, so you need to be 100% confident that you can always repay the amount spent. Providing that you repay in full each month, you won’t be charged any interest, so the APR won’t affect you.
The Final Word:
Whatever you decide to do, providing that you’re consistent and disciplined, you can raise your credit score fairly easily. Just be mindful that you won’t see improvements overnight. Credit agencies update your report with new information every 30 days, but it could take 3-6 months for you to start seeing real changes. In summary, you need to be both proactive and patient with your credit score. Well, there you have it, four hassle-free ways to better credit!