Credit scoring explained.

Here are some points that may influence your application

1. Each Provider has its own credit-scoring rules. Providers refer to credit referencing agencies, Usually Experian and Equifax,which hold details of your financial history. Your credit score depends on what the provider considers to be acceptable, It is the provider who decides the reference agency merely gives information it does not tell the provider what to do.

2. Your past credit history will also form part of your credit record. This often accounts for around 35 per cent of your score. Your score will be much better if payments for existing products are up to date and have no missed payments

3. It's essential to be recorded on the electoral roll. Your application may well be rejected if it is not. The Electoral roll is updated towards the end of the year and is available April the next year, so it can take time to get on it.

4. How long you have worked for your employer affects the score too, the longer the better basically.

5. If you have lived at your current address for 3 years then the score is better.

6. How long you have banked with your bank is a very important point, the longer the better for you.

7. Multiple applications for credit may score low. Every time you apply for a credit product the provider will do a search via an agency. Having many credit searches recorded may put providers off and lower your credit score.

8. Providers use their own credit-scoring criteria, you may be turned down by one provider but accepted by another, even from the same information.

9. If you have any CCJ's (county court judgment's) in the past year then you will score lower (but not everyone will reject you). If the CCJ's are over 6 years old then they will most likely be ignored
10. If you're application for a product is declined; you really should try and find out why, the more Providers you apply to the more searches you will have recorded on your credit file So it may be in your interests to send off for your file and have a good look and then check out providers criteria before you apply to them.

11. If you are declined by a provider due to their credit-scoring criteria, but you know that you do not have a bad credit history then you could appeal, it may be that you are not recorded on the electoral register etc. and then the Provider may be willing to reexamine your application.

12. You can get a copy of your credit files from the leading agencies. Request your file by writing to Equifax plc, Credit File Advice Centre, PO Box 3001, Glasgow G81 2DT, or Experian Ltd, PO Box 8000, Nottingham NG1 5GX. Send a Cheque or postal order for £2 with each letter. Both agencies record slightly different information about you and you'll have to send requests to both Experian and Equifax to be fully informed.

13. If you spot a genuine mistake on your file then contact the agency and they will get in touch with the provider regarding the incorrect details but it must be a relevant mistake, you can't just get things removed or change because you don't like them. If there is something on your file that is unresolved or the provider is not communicating then you can ask for a notice of correction to be applied to your account regarding this,

14. All is not lost if you can not get main stream credit products, at the moment 20% of UK people can not either, there is now a massive market for sub prime or non status customers and there are many providers who will consider you.

15. The interest rates are not as good as the main stream providers but then again at least you have a choice that wasn't there a few years ago, As soon as your credit file is back in order then you can get back to using main stream credit providers.

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