Improving your credit score after debt problems
After debt problems, your credit report might not be in the best shape. It could show some missed or late payments, defaults or even a CCJ. But how easy is it to start to improve your credit score?
Getting the perfect score on your credit report can take some time and hard work. But don’t worry – you can absolutely take some steps to start to improve your credit score right away.
By focusing on getting the basics right, you can make sure your credit score doesn’t hold you back. And you can start to work towards getting yourself to a place of financial sustainable wellbeing.
Checking your report
First things first – you need to check your credit report. Your credit report is what any potential lenders will see when you apply for credit.
And it’s not just lenders who can credit check you – landlords, employers and insurers might search your report too. Read more about who checks your credit report in our blog.
You can check your credit report for free from each of the three credit reference agencies – that’s Experian, Equifax and CallCredit. Yes, there are paid-for versions of your credit report but you can get a basic version for £0.
It’s a good idea to check your report with each credit reference agency as the information they hold can be different. For example, Experian might show that everything’s fine but CallCredit could show an incorrect default.
By looking at your credit report, you can get an idea of what it’s saying about you. And if there are any areas for improvement, you can identify what these are and start to improve them.
Quick tips to improve your credit score
Having a good credit score isn’t just about being able to borrow again. As we mentioned, different people can check your credit report too – for a mobile phone contract or a tenancy agreement, for example. That’s why a positive credit score can be good for your finances in general.
Here are a few tips to start to improve your credit score today.
- Get on the electoral roll. No, voting doesn’t improve your credit rating – that’s just a myth. But registering to vote puts you on the electoral roll – and this is a positive. Lenders and other services use the electoral roll in their fraud checks, to see you are who you say you are. If you don’t appear, they might be more likely to reject you.
- See if there are mistakes. Any errors on your credit report can hold your credit score back – a default you didn’t get, for example. If you find any mistakes, contact the credit reference agency and the lender who the error is showing for. They can correct this.
- No love lost. Did you have joint credit or a joint bank account with an ex? You might have a ‘financial link’ with them and any issues they have with credit can affect your score. Contact the credit reference agencies and ask them to file a Notice of Disassociation. This will help you make a clean break from your ex’s financial history.
- Keep it clean. Any issues drop off your credit report after six years. So, if it’s been a while since you missed any payments or had a default, your credit score will clear up soon. For now, focus on keeping your credit score clean by paying your bills on time. That way, when any negatives drop off your report, it will only be positive.