You credit score, how it works, how to improve it and where to check

Understanding the myths and truths of your credit history

The mysterious and fabled credit check! That strange number standing between you and your next loan, credit card, or even mobile phone contract. It’s the source of concern for a lot of people, so we’ve broken it down for you with our simple guide to your credit score.

1. There’s no such thing as ‘your credit score’

Wait – what? But the title of the article . . . Sorry to mislead you, but the concept of a single score is a myth. Different agencies use differing criteria, so you’re likely to see different scores depending on who you ask. Scores are generally a little misleading anyway, as there’s no absolute way of measuring your creditworthiness.

2. You don’t have to pay a subscription to access your credit report

You can order your statutory credit history from any of the main credit check agencies for as little as £2. This can take a little time, so if you’re in a hurry, you might want to invest in a subscription anyway. You can always cancel!

3. No debt isn’t always a good thing . . .

If you’ve never had any debt that doesn’t automatically mean you’ll have a high score. Lenders like to see that you’ve been able to pay back a credit card or loan, so no credit history can mean they are more cautious with you.

4. There’s no hiding from your history

If you’ve ever missed a payment or instalment it will often show up on your report. It’s worth checking through your history to ensure there are no errors, as a negative marker can impact a lender’s decision. You can ask the lender to resolve this, as they can communicate directly with the credit report agency.

5. There are lots of ways to see your credit report.

It’s not just Equifax and Experian anymore. Companies like Credit Karma can offer free reports instantly, and Checkmyfile is a multi-agency check.

Ensuring your credit history is accurate and that you’re keeping up with payments on any loans or credit cards is the best way to give you the best chance of being accepted for future credit. If you’re trying to get your finances in order to buy a house, for example, then a mortgage broker will help you get everything sorted and is usually better than speaking directly to the lender.