Credit Score Improvement - Free Reports & Ways to Fix a Bad Score (2024)

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Created: Tuesday, 29 August 2017 21:51
Last Updated: Thursday, 30 September 2021 20:44

Credit Score Improvement - Free Reports & Ways to Fix a Bad Score (1)

Credit scores can be confusing and stressful, here's an all you need to know guide to get your free report, learn what your score means and find easy ways to improve it

Credit Score Improvement - Free Reports & Ways to Fix a Bad Score (2)

To get any sort of 'credit' including loans, mortgages, overdrafts, credit cards, contract mobile phones, or even monthly car insurance, lenders use a scoring system to predict your likelihood to pay.

What is Credit Scoring?

Scoring systems differ from lender-to-lender, and product-to-product and no one really knows exactly what each lender looks at and uses to judge. So just because one company may have rejected you, does not automatically mean another one will and the same goes for an acceptance.

You might think your score is good and have had one lender say 'yes' and then get rejected by another, this could be due to many factors including over-applying, reaching your 'available' credit limit, and of course, the particular lender having different criteria.

Credit scoring doesn't just dictate what products you'll receive, but also how good the ones you actually get are. For example, most loan rates are 'typical', meaning the APR depends on your credit score; with credit cards, if your score's too low for the deal you wanted, you might get accepted but sent/offered a different product.

Credit company's use a variety of information to make their decision whether to lend to you, including data held by three companies known as 'credit reference agencies'Experian, Equifax, and Transunion.

Credit Score Improvement - Free Reports & Ways to Fix a Bad Score (3)

11 Steps to Increase & Protect your Credit Score & Ratings

1 - Periodically check your credit file for errors

If possible, check all three agencies. While doing a check is recorded on your file, it does not add a 'credit search' that a lender can see. It's worth checking because a simple error could cause you a problem. It is a good idea to do a check-up roughly every 1-2 years and always do one just before making any important applications such as mortgages.

2 - You must have credit to have a Credit History

If you haven't had credit before then you will obviously won't have 'good' credit, so if this is your first credit card, then you might have to get one of the beginner cards such as the Capital One Classic which is much easier to obtain.

3 - Manage your accounts properly

Accounts with a lot of history of good usage will score higher, as with credit scoring, good account management history matters. Although too many cards can also be negative, try not to have more than 6 active credit cards at any one time and close any dormant cards you may have.

4 - DON'T MISS PAYMENTS!

Don't be late - Period - Manage your monthly payments, use direct debits and standing orders, if in doubt pay early, as if you're seen to be a constant bad payer you won't be offered any credit.

5 - Have a spread of account types

Such as an overdraft, current account, credit cards, a mortgage, and loans.

6 - Time your applications correctly

The notes left on your file when you apply for things, in a short space of time hurt your score. Space out applications, not just for credit but for car insurance, mobile phones, and others, as all can leave searches on your file. Moving house also disrupts a score, so make important applications pre-moving. Plus, you will score better when you're earning, so if you're about to take time off, go on maternity leave or suspect potential redundancy, apply beforehand - You should never lie on applications.

7 - Read and understand your cards Terms & Conditions

So as you are not hit by a charge out of the blue i.e. some cards may require you to spend at least £500 over a 12 month period etc.

8 - Beware of mass marketing tricks

In truth, being "pre-approved" or "pre-selected" for credit is a waste of time. This marketing trick is most generally used by companies looking for people who will be easily beguiled by the glossy literature with dazzling headline rates and are not too inclined to read the small print. Worst case scenario, being on the lists of marketers who mass-mail this sort of material can be trouble because the ready-completed forms can be sent to old addresses from out-of-date databases and leave people open to identity theft, as fraudsters scoop up the junk mail in communal halls and waste bins. If you think you might be at risk in this way, contact the Mailing Preference Service (mpsonline.org.uk) and get your name taken off the mailing list.

9 - Get yourself on the electoral roll

If you're not on the roll, it's unlikely you will get any credit, so sign up immediately. You don't need to wait for the annual reminder, you can sign the register at any time on the Gov.ukWebsite. You can also use this to ensure your information is correct.

10 - Evidence of stability

Home owners rather than renters, and those who are employed, rather than self-employed, tend to be more appealing. Putting a landline number rather than a mobile number on application forms can help with security checks and improve your chances. Being with the same employer, bank and current address for longer will all help too.

11 - Check the address on all active accounts

You may not have used your old mobile contract or credit card for five years, but if the account is still listed as open and you had a different address this can hinder applications due to ID checks.

Unfortunate truths about money lenders

> Lenders are not obliged to give out credit.

> Universal credit 'ratings' and 'blacklists' do not exist.

> Even good risks can be rejected just because they will not make the bank enough money.

> It is all about sophisticated customer weeding (the whole process is about lenders picking their perfect customers)

> Credit card companies may reject you for always repaying cards in full.

> It's all about how financially attractive you are.

> Credit scoring's about profit, not risk.

> Rent payments can go on your credit file - Rent payments could appear on your credit file. This was delayed into winter 2013. This means whether you're on time or late paying rent, it could start to affect your ability to get credit. This won't automatically be in your rental agreements, the landlords would have to insert it and get you to resign before they can start doing this and for the moment it is only for the private rented market, in a separate section to any mortgage, loan or credit card history.

Landlords will be able to see your rent-paying history to judge you as a potential tenant, but not the rest of your file, including credit card and loan information.

Putting things right...

There are a few leading credit report websites that offer free 30 day trials including:

Equifax

CheckMyFile

But more recently some major credit report websites are offering completely FREE for life credit reports that are updated every 30 days, including:

ClearScore

Experian

Credit Karma (formerly Noddle)

Dealing with default notices on your file

One of the main problems people face is past debt defaults ontheir file, these can easily hamper most applications to get new credit and if they are genuine. Defaults stay on your credit file for six solid years from the date the default was documented and there's nothing you can do about them.

After the period, it will automatically be deleted from your credit report, whether it has been paid, satisfied, or not. Was the default unjust? There are a few things you can do if the default is unfair.

Complain to the Ombudsman

Firstly write to the company and complain that the default isn't fair. Ask for it to be wiped from your file. If that fails, complain to the Financial Ombudsman the free independent arbiter of disputes, it can rule both that the debt is unfair and that the default can be wiped.

Negotiate with the lender

Are you prepared to settle the debt? either in part or in full? then you can enter a negotiation with the company you owe the money to. You can make it a condition of settlement that the default is wiped off your credit file. Companies are allowed to do this for disputed defaults

Add a 'Notice of Correction'

If all else fails, and you believe the default's justifiably unfair, you can add a notice of correction to the file explaining the problem eg, saying: "It was a joint account and the debt was run up once I no longer had access by an ex-husband/wife." This will, of course, slow down any application because then the companies will have to look at the application manually, but as a substantial default is likely to stop you from getting credit anyway, that is usually not a problem, providing it helps.

Dealing with a CCJ

If you have a CCJ on your file or are being threatened with having one added, you need to act fast. There are a fewsteps you can taketo get a CCJ removed.

Protecting Your Score

There's inevitably going to time times when you need to apply for a loan or a credit card, justremember to utilise all the free tools out there such as onlineprice comparison tablesto get a feel for potential loan companies APRs

You should also, ideally only apply to lenders that allow soft searches prior to applying, as these do not affect your credit score, although it will be recorded on your file like every othersearch, lenders can't see it, so it won't affect their decision.

You can also use loan comparison websites such as MoneySuperMarket.com that provides a great free 'Loan Eligibility Checker' which performs only soft searches so you can see a variety of loans available and the APRs that you're likely to be accepted for.

And as always, if you have any other fool-proof ways to improve your credit score, please let us know in the comments below...

Credit Score Improvement - Free Reports & Ways to Fix a Bad Score (2024)

FAQs

Credit Score Improvement - Free Reports & Ways to Fix a Bad Score? ›

Paying your accounts on time and in full each month is a good way to show lenders you're a reliable borrower, and capable of handling credit responsibly. Old, well-managed accounts will usually improve your score - although be sure to read about the potential impact of unused credit cards.

How to improve credit score if you have bad credit? ›

How to improve your credit score
  1. Check your credit report for errors. ...
  2. Prioritize paying on time. ...
  3. Work to pay down your debts. ...
  4. Become an authorized user. ...
  5. Request a credit line increase. ...
  6. Handle debt in collections. ...
  7. Consider opening a secured card. ...
  8. Get credit for other payments.
5 days ago

Can you improve your credit score if its bad? ›

Paying your accounts on time and in full each month is a good way to show lenders you're a reliable borrower, and capable of handling credit responsibly. Old, well-managed accounts will usually improve your score - although be sure to read about the potential impact of unused credit cards.

How do I fix my credit myself for free? ›

How Can I Repair Credit Myself?
  1. Request Credit Report. ...
  2. Review Reports Carefully. ...
  3. Dispute Any Incorrect Information. ...
  4. Pay Bills on Time. ...
  5. Pay Off Delinquent Balances. ...
  6. Decrease Your Credit Utilization, and Pay Down Your Debt. ...
  7. Open Different Types of Accounts. ...
  8. Keep Accounts Open.

What is the fastest way to fix your credit score? ›

Reduce the amount of debt you owe

Pay off debt rather than moving it around: the most effective way to improve your credit scores in this area is by paying down your revolving (credit card) debt. In fact, owing the same amount but having fewer open accounts may lower your scores.

Can you fix a really bad credit score? ›

If you want to fix a bad credit score, you have to show lenders you can borrow money and pay it back on time. If you have a poor credit score, you might find the only credit cards you're eligible for are credit building credit cards, or “bad credit” cards. These cards often have high APRs and low credit limits.

How can I restore my bad credit score? ›

8 Steps to Rebuild Your Credit
  1. Review Your Credit Reports. ...
  2. Pay Bills on Time. ...
  3. Lower Your Credit Utilization Ratio. ...
  4. Get Help With Debt. ...
  5. Become an Authorized User. ...
  6. Get a Cosigner. ...
  7. Only Apply for Credit You Need. ...
  8. Consider a Secured Card.
Nov 2, 2023

Can you fix a ruined credit score? ›

Repairing bad credit is possible but time-consuming. There is no one-size-fits-all strategy, and the process can be a minefield. You need to know what steps to take, where to find help and which credit repair companies to avoid. Your credit report and score both wield a huge amount of power over your personal finances.

Can I pay someone to fix my credit? ›

Yes, it is possible to pay someone to help fix your credit. These individuals or companies are known as credit repair companies and they specialize in helping individuals improve their credit score.

How long can it take to fix a bad credit score? ›

It may take a few months to recover from a hard inquiry, a few months (or years) to recover from a 30-day late payment, and much longer to recover from a 90-day late payment or other major negative mark (such as a foreclosure).

How to wipe your credit history clean? ›

How to remove negative items from your credit report yourself
  1. Get a free copy of your credit report. ...
  2. File a dispute with the credit reporting agency. ...
  3. File a dispute directly with the creditor. ...
  4. Review the claim results. ...
  5. Hire a credit repair service. ...
  6. Send a request for “goodwill deletion” ...
  7. Work with a credit counseling agency.
Mar 19, 2024

What is DIY credit repair? ›

DIY credit repair means taking steps to fix your credit score on your own, such as disputing errors on your credit report and making timely payments on debts.

Who is the best credit repair company? ›

The best credit repair companies of May 2024
  • Best overall: Credit Saint. Credit Saint. ...
  • Best for couples: Sky Blue Credit. Sky Blue Credit Saint. ...
  • Best for low initial work fees: The Credit People. The Credit People. ...
  • Most affordable: Credit Firm. ...
  • Best track record: Lexington Law. ...
  • Best for additional features: The Credit Pros.
5 days ago

How do I rebuild my credit ASAP? ›

Here are eight tips that could help you rebuild your credit.
  1. Review your credit reports. ...
  2. Pay your bills on time. ...
  3. Catch up on overdue bills. ...
  4. Become an authorized user. ...
  5. Consider a secured credit card. ...
  6. Keep some of your credit available. ...
  7. Only apply for credit you need. ...
  8. Stay on top of your progress.

How can I raise my credit score 100 points overnight? ›

  1. No, it is not possible to raise your credit score overnight. ...
  2. Improving your credit score typically requires responsible financial behavior over an extended period. ...
  3. Pay Your Bills on Time: Consistently make on-time payments for all of your credit accounts, including credit cards, loans, and utilities.
Oct 25, 2023

How fast can you fix a 500 credit score? ›

For instance, going from a poor credit score of around 500 to a fair credit score (in the 580-669 range) takes around 12 to 18 months of responsible credit use. Once you've made it to the good credit zone (670-739), don't expect your credit to continue rising as steadily.

How to get a 720 credit score in 6 months? ›

To improve your credit score to 720 in six months, follow these steps:
  1. Review your credit report to dispute errors and identify areas for improvement.
  2. Make all payments on time and avoid applying for new credit.
  3. Lower your utilization ratio by paying down balances, increasing credit limits, or consolidating your debt.
Jan 18, 2024

How can I get a good credit score from poor? ›

Build a credit history to improve your credit score
  1. Open and manage a current account and stay within any agreed overdraft.
  2. Pay your bills on time – setting up Direct Debits can help with this.
  3. Be wary of joint accounts if the other person has a poor credit history. ...
  4. Use eligibility checkers before applying for credit.

How to increase credit score by 100 points in 30 days? ›

Steps you can take to raise your credit score quickly include:
  1. Lower your credit utilization rate.
  2. Ask for late payment forgiveness.
  3. Dispute inaccurate information on your credit reports.
  4. Add utility and phone payments to your credit report.
  5. Check and understand your credit score.
  6. The bottom line about building credit fast.

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