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Things To Know About Credit Score

Before we begin, here is a range of the common terms you will come across in regards to this topic. A default is used to denote where you have violated your credit arrangements. When you have neglected a payment on a mail order account, as an example, they may place a Notice of Default on your credit file. This will have a negative effect on your credit report down the road should you want to get additional credit.
A 'CCJ' is the short form for County Court Judgement. This signifies a legal judgement from a County Court connected to someone in debt to others (a person or business) or a circumstance where they have not complied with the stipulations of a credit arrangement. The Judgement will set a reasonable pay back schedule with the intent that the person in debt will be able to give back their debt. These judgements are documented on public record and will affect the debtor's potential of securing any further credit for the next six years.
Equifax is one of a number of key credit referencing agencies in the UK. Equifax pulls together all your financial information from various places to establish a report that indicates your credit history - i.e. your credit report. When you make an application for any kind of credit, loan companies will examine you report to understand your credit history. You could obtain a duplicate of your report anytime you like to check that everything is in order. The Equifax website has plenty of valuable instructions on how to make credit choices and safeguarding yourself from scams.

A Credit Score is something used by loan, mortgage and credit companies to decide whether you qualify for a particular product. A Credit Score looks at your current and past financial history, plus other personal details, and using mathematics, analyses what type of 'risk' you are.

By 'risk' we mean whether it is likely you'll pay back the money borrowed; whether you can really afford the repayments etc.

Factors that can affect your score include:
1. late or missed payments in the past
2. County Court Judgements and arrears
3. How much you currently owe - even if all your payments are up to date
4. You not being on the electoral roll
5. Applying for lots of new credit accounts - this is viewed that you are someone getting into financial trouble
6. The length of your credit history
7. Financial associations - other people listed on your credit file that have bad debts can affect your credit rating

Why Your Score Matters
Your Credit Scores matters because it is probably the most influential factor used by loan companies in deciding whether they will give you a loan/mortgage/other credit.

However, it is the lender who makes the final decision and they may well take in to account reasons for past credit problems. Apart from checking out your financial history, they will also need to look at your occupation; whether you have any equity in your mortgage, your income and savings etc.

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James Miller also writes on various subjects relevant to personal loan provider,cheapest secured loans and relevant to interest only remortgages.

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