In addition to information supplied by lenders and financial institutions, and information sourced from the public domain there are a variety of other pieces of information that provide information relating to certain activities, mainly relating to financial matters, although not exclusively, you may have undertaken.

Matters of Public Record

Electoral Roll information

The primary source of information which is on your credit report which provides information about your identity is that provided by the Electoral Roll. The Electoral Roll is information, which includes your address is the method by which lenders and financial institutions identify that you are both who you say you are and that you have a proper residence in the UK. Without this validation it is likely that you would have difficulty borrowing money from almost any source, so as a tip it is a good idea, wherever you live and whether or not you intend to vote in an election to ensure that you are on the Electoral Roll.

The actual information held on your credit report, sourced from the Electoral Roll is as follows:

• Your local authority’s name
• the address that you local authority has you recorded as living at
• who is registered to vote at the the aforementioned address
• the dates when those people first registered as living at that address.

Each local authority is responsible for maintaining the information included on the Electoral Roll but you are responsible for informing them of any changes to your circumstances that they need to update. For instance if you move house during the year you should inform the local authority of your new address, or if you move to another local authority then you should notify your new authority of your move, and the old authority to remove your name from their lists. Remember none of this may seem terribly important as the authorities will eventually discover your changed circumstances, but as the information eventually finds its way onto your credit report or credit file and the credit reference agencies it is important that you update promptly.

The Electoral Roll is issued each year in December and the credit reference agencies update the information included on your credit report yearly too. But as indicated above lenders and other financial institutions use information on your credit report which is obtained from the electoral roll. They use the address on the electoral roll as a method of validating the address they may have for you, possibly from your credit application. So it can’t be emphasized enough make sure the information on the Electoral Roll is up to date and accurate.

County Court Judgments

Information relating to any court judgement not just those from County Courts are recorded by the Registry Trust, an independent organization set up by Lord Chancellor’s Department. The Registry Trust supplies the information relevant to your credit report to the credit reference agencies as they occur.

You should be aware that the court judgement is recorded on your credit report from the date of the judgment and remains there for six years.

Now, the following information is important. Please read it carefully and if relevant to you take action today. Not doing so will mean the record of the court judgment will remain on your credit report for a long time.

There is a sure-fire way of removing a County Court Judgment from your credit report promptly. If you can afford it then you should pay and pay quickly as follows:

1. Pay the amount required by the court judgment within one month of the date of the judgement.
2. Request that the court then issues a Certificate of Satisfaction documenting that the matter has been resolved.

If you have completed these two steps then you may notify the credit reference agencies of your actions and they must remove the record of your court judgement from your credit report, or credit file. As an on-going record of a court judgement can significantly impair your ability to borrow money, or even undertake the simplest of actions such as opening a bank account, prompt actions is clearly the most sensible course of action.

Should you miss the deadline and settle the judgments after one month then a record of the court judgement is kept on file but marked as ‘satisfied’ once the Certificate of Satisfaction has been issued. This is done by the court.

If you do not manage either of the above there may still be a way of having the County Court Judgment removed from your credit report. The method hinges on exploiting a potential legal technicality. In essence you challenge the manner in which the matter was brought to court. It is this process that credit repair companies are seeking to follow. The good news is that you can actually do this yourself and save yourself a lot of money in the process. This will be the subject of another article.

Other Matters of Public Record

In the even that you have declared bankruptcy, a record will be kept on your credit report by the credit reference agencies. This information is obtained from the official gazettes. The record is kept on your file for six years starting. The date from which this is tracked is the date of court order of the bankruptcy.

Information From Lenders and Other Financial Institutions

The information provided to the credit reference agencies by lenders does vary.

Some lenders only update the credit report when a customer has defaulted in some way. A default is technically any incident in which a customer has not kept to the terms of the credit agreement, although in practice this predominately relates to payment problems.

Most lenders however supply information to the credit reference agencies throughout the life of each and every credit account.

The credit reference agencies tend to keep information about an individuals credit account for a period of six years.

As you will have worked out by now, lenders use the information provided on the credit report, or credit file to try to identify in advance of lending money who will be good payers. The credit report is not just about weeding out bad payers.

As an aside a person may still be classed as a potential bad payer if they have several existing credit accounts as the lender may conclude that that person has too many financial commitments already. This may occur even if all existing accounts have been kept up to date throughout their lifetime. This information is sourced from… you guessed it, the credit report held at the credit reference agencies.

Classification of Credit Account on the Credit Report

Credit accounts are classed as ‘settled’, ‘active’, ‘defaulted’, or ‘delinquent’.

• An account which is marked as settled is an account for which your have repaid all outstanding balances. The credit reference agencies maintain information on all your settled accounts. This information is kept on your credit report for a period of six years. The date starts on the day you make the final payment. Obviously any payment record shown on your credit report will relate to the period prior to the final repayment of your credit.
• If an account is classed as active it is one which is not fully paid off but for which you are continuing to make payments on time upon. The credit reference agencies do maintain records of your accounts until they are finally settled and then keep these records for a period six years following this date.
• An account marked as defaulted is an account for which you have not maintained the appropriate payment regime. Agencies keep a record of these accounts on your credit report for a period of six years from the date you first breached the terms of the credit agreement you had in place. The record kept on the credit file will include the amount of money you still owe (the default). When you have finally repaid everything you owe from the date of breaking the terms of the credit agreement, the account will be marked as ‘satisfied’ at the close.
• For an account to be marked delinquent account your repayments, for two or more consecutive months, will have been shown to be in arrears by a minimum of three months. They might also have been late for at least three months in the preceding year.

Payment Record on Your Credit Report

For each credit account showing on your credit report you will get a status history. The status history shows whether payments have been made on time or not. This information can include your payment record for a period up to 36 months. For those of you confused by this the first entry is shown as the most recent payment.

Firstly the last 12 months’ payments are shown, then underneath there is a record of the payment history over the period up to 36 months. Included within this record are a summary of how many times payments have been up to two months late, shown as ‘number of status 1-2’ and the number of times payments have been three or more months late, shown as ‘number of status 3+’ within the last 36 months (or since the account was opened if earlier).

Other information

Information from the Council of Mortgage Lenders

If you have, in the past, been forced to give up your home, or had your home repossessed then the members of the Council of Mortgage Lenders record this information on your credit report. This information gives details of the credit incident. Items such as the address from which the mortgage application was originally mad, the address of the home in question and the address that the particular customer now lives at.

Record of Credit Applications

In order to establish whether you are making multiple credit applications, in which case you may be considered a potential bad payer as you may be being turned down on a regular basis, or you may be getting into a position where you are over-committed, the credit report includes a record of lenders who have searched your credit file as a result of you applying for credit from each of them. This record will remain on your credit report for 12 months.

Unrecorded Enquiries

A company that has searched you credit report for matters not related to lending you money or c credit application of any sort the search is recorded as an ‘unrecorded enquiry’.

As this information is likely private to you and not of any relevance to lenders searching your file in order to make a lending decision this information is not disclosed to them.

Credit Quotations

When you request a credit quotation it is quite likely that the prospective lender will search your credit report in the process. These searches will be documented as quotation searches on your file. This is so that other lenders do not mistake them as additional credit applications.

Other Agencies

Agencies make a record (known as a ‘footprint’) on your credit report to show that a file has been applied for in your name and address, but this will be shown only to you and not to lenders.

Previous Addresses

Previous addresses, or any addresses you may use or have used for correspondence, may also be listed on your credit file.

This allows lenders or financial institutions to check whether there has been any poor credit activity at an address in which you were previously a resident. Whilst this would not necessarily result in any application you may be pursuing being turned down hopefully you can see that if this important to lenders to ensure you have not been involved in any undeclared credit delinquency in the past.

Your credit report will show the two addresses that are linked together. It will also provide information on the manner in which the link was created including when it was created and it’s source. These links are only removed when the agencies are requested to do so by the organization that created the link.

Information About Other People

By law your credit report must include information about members of your family who live, or have lived, with you. This is because you are entitled to see all the information that lenders or financial institutions who are reviewing your file have available to them. The only way to achieve this is to ensure the credit reference agency includes the information about your family members for your review.

Should you share a financial responsibility or commitment with another person, for example a joint mortgage or a joint bank account this will be shown on your credit report together with details of the person with whom you share the responsibility and when the credit relationship was created.

Agencies may be told about any other names you have been known by and your file will show who gave them the information.

The rules on what lenders can do with information about other people are changing. It looks likely that in the future, details of financial information about other people may not be recorded on your credit file. Once enacted , only your own credit history, and anyone who you have got a joint financial commitment with will be available to be given to lenders.

CIFAS

As part of efforts set up to detect and prevent fraud lenders and financial institutions have developed, in consultation with the Office of Fair Trading and the Office of the Information Commissioner, a system called CIFAS.
The CIFAS system is essentially a fraud avoidance system. It allows its members to exchange details. These details include applications for products, services or employment, which are considered to be fraudulent. They are designated as potentially fraudulent becasue the information provided by the relevant applicant has failed the verification checks undertaken. Member organizations may also exchange information about accounts and services which are being fraudulently misused or fraudulent insurance and other claims. CIFAS member organizations are also able to exchange information about innocent victims of fraud. This is intended to protect them from further fraud.

The CIFAS system is only used to prevent fraud. CIFAS is not a credit reference agency. A CIFAS warning on your file does not mean you are being accused of fraud. If an organization is a member of CIFAS they make sure that they examine credit applications very carefully. They may in fact make personal contact with you in order to determine whether you have indeed applied for the credit. They will not automatically refuse applications from people with warnings on their file.

Gone Away Information Network (“GAIN”)

Credit reference agencies are members of GAIN. GAIN is a network designed to enable lenders to share information about particular customers who appear to have moved home without informing their lenders of their forwarding address.
Information included on a credit report may current and previous addresses and any other addresses that that particular customer has been shown to have been living at.

Conclusion

As hopefully you can clearly see it is worth knowing exactly what information may be included on your credit report or credit file. Information is sourced from many different organizations and if any of the information is erroneous or inaccurate it may cause you considerable problems. In short it is wise to find out what is included on your credit report as soon as possible. For information on how to get a copy of your credit report from the various credit reference agencies please read How to Repair Your Credit.

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Before letting you know how to go about undertaking the process of credit repair you need to know a little bit about your credit status is evaluated.

Lending and other financial institutions in the UK have all agreed to share details of their customers credit arrangements with each other. They do this through a credit reference agency who maintain a file on each individuals credit activity, called unsurprisingly, a “credit report” or “credit file”.

This means that everytime you, as an individual, take out a loan or a credit card or a mortgage your credit file is updated. In fact, your credit file is updated on a monthly basis by these lenders as they record payment activity on the various loans or credit cards you may have taken out.

The reason for setting up this information sharing arrangement is that it allows the lender to check, when you apply for credit, that you have properly repaid other lenders in the recent past or is are properly paying current credit commitments.

As you might expect, many people have experienced problems at one time or another in repaying their individual credit items. They may have had to default on a loan, had a County Court Judgment issued against them or just been late on a few credit card payments. All these events will be recorded on their credit file. The result of this is that when they come to apply for new credit, such as a personal loan, a mortgage, a new credit card, car finance or even a simple bank account, they may end up being turned away.

To put it into everyday terms, let’s say you lent a friend some money and they promised to pay you back by the end of the month. If they then didn’t pay you back for a while and you had to keep chasing them to recover the money you would probably be pretty reluctant to lend to them a second time. If on the other hand they paid you back promptly, when they said they would or even early, you would probably be much happier to lend to them again should they ask. You would have made an assessment of their ability to pay you back by your knowledge of how good they had been at paying you back in the past. This is what the financial institutions are attempting to do with the information on your credit file.

So what is actually recorded on your credit report? Well, your credit report includes information from two main sources:

1. The Public Record, meaning Electoral Roll information, County Court Judgements, bankruptcy or formal individual voluntary arrangements (“IVA’s”).

a. Electoral Roll information includes your name, your local authority, the address your local authority believes you live at, the names of any others believed by the local authority to be staying at your address and the date they were first recorded.

b. County Court Judgments are held on your credit report for a period of six years from the date of the judgement.

c. Bankruptcy matters and IVA’s are also held on the credit report for a period of six years from their start date.

2. Lenders and financial institutions in the UK. In brief this includes

a. This includes information about any items of credit you have taken out in the last six years.

b. Each credit item will have include a payment history showing whether or not you have made payments on time.

Most people are completely unaware of the existence of credit information, credit files and credit reference agencies, yet as you can see from above they are tremendously important in today’s recessionary climate. Almost every lending institution will automatically run a credit search on you, by contacting the major credit reference agencies, as the first step in processing a credit application you might have made.

What’s On My Credit File?

You can get a copy of your credit report or credit file as the credit reference agencies are required by law to send you a copy. They will charge you £2 however in order to cover their administrative costs. In order to get your copy you should contact one of the following credit reference agencies. It is probably easiest to do this via their website. Ignore any subscriptions offers they place in your way, or fancy free credit report offers. These are just marketing ploys to entice you into a subscription service. Their contact details are as follows:

Callcredit plc

Consumer Services Team
PO Box 491
Leeds
LS3 1WZ

Tel: 0870 060 1414

www.callcredit.plc.uk

Experian

Consumer Help Service
PO Box 8000
Nottingham
NG1 5GX

Tel: 0870 241 6212

www.experian.co.uk

Equifax plc

Credit Advice Centre
PO Box 1140
Bradford
BD1 5US

Tel: 08705 143700

www.equifax.co.uk

Credit Repair – The First Steps?

First things first, before we get into the credit repair process. As explained above, the information held on the credit report is a reflection of your past payment history. You effectively earn a clean credit report by making payments on all your outstanding credit arrangements in full and on time for a sustained period.

This article assumes you have not got a clean credit and that you wish to start the credit repair process. Hopefully you will see that you can take simple practical steps to undertake your credit repair.

The first thing that needs to be said is not to worry, if you have had payment problems or experienced other adverse credit events in the past do not be dismayed, take it step by step, start today. Each step is not particularly complicated and if by making the effort you will achieve a signficant benefit.

The steps documented below will not help you if you have a County Court Judgment (“CCJ”) recorded on your credit file. You may well have seen advertisments from credit repair companies about how they are able to remove County Court Judgments from your credit report. Technically this is not true. A properly recorded CCJ will only be removed if you pay the outstanding amount within 28 days of the date of the judgment. If you miss this payment deadline then even if you settle in full a record will remain on your credit report and no credit repair company on the planet will be able to remove it. However, if you have not settled in full there may be a process you can follow to have the judgment removed on the basis that it was not properly recorded. This is known as a legal “technicality”. It is exploiting this technicality that the credit repair companies are offering. For a fee, of course. The good news is that you can undertake the process the credit repair companies follow yourself. However, how you should deal with County Court Judgments will be the subject of a subsequent article.

The first step may surprise you. Make sure you are on the Electoral Roll and that your details are correct. Remember, your objective is to repair your credit rating. You wish to show the financial institutions that you are a stable and reliable person. Appearing on the Electoral Roll is evidence that you have a residential address, and therefore are unlikely to unexpectedly disappear, and that you are a responsible person prepared to vote in elections on matters affecting the welfare of the country in which you live. You can find out details of the Electoral Roll, or how to register on it, by contacting your local authority.

Next apply to each of the credit reference agencies for a copy of your credit report, or credit file. The reason for this should be obvious. If there are any errors or mistakes on one report then it is quite likely that they will be on the other reports. Repairing one credit report may well leave your credit rating impaired on the remaining two.

Once you have them, read them all carefully for any errors:

o Have they spelt your name correctly?

o Does it show your correct address?

o Are all the loans shown as outstanding correct?

o Are the payment histories accurate?

Don’t assume the credit reference agency will have got your details right. As you may imagine they deal with many hundreds of millions of transactions every month, if they only got a very small proportion of these wrong it might still represent tens of thousands of errors each month.

If you do find errors then you should contact the credit reference agency and request the error be corrected. The credit reference agency is required by law to investigate the matter and if the error is confirmed to alter the relevant material. In fact credit reference agencies have to tell you within 28 days of hearing from you if they have taken action to correct your file and, if not, why they have not done so.

The final step is to address the problem of a poor payment record on your credit report. The best way to think of this is that you need to balance the poor payment history on previous credit arrangements with a good credit history on current or new credit arrangements.

Probably the easiest way to do this is to start using a credit card for everyday expenditure and ensure that you repay the full amount at the end of each month. Try not to think of the credit card at this point as borrowing more money. Don’t spend more in a month than you can afford to pay off in full at the end of the month. Remember you are trying to undertake a credit repair process, to restore some balance to the adverse payment record on your credit report.

In practice this means that if you usually pay cash for everyday items, try paying with the credit card instead and saving the cash up to pay off the card when the bill arrives. When the bill arrives, pay it straight away. If you usually use a debit card, again use a credit card instead.

If possible, set up a direct debit with your bank to pay off the full credit card balance automatically each month. This way you are less likely to forget, or make late payments.

If you don’t have a credit card then there are some companies that specialise in issuing cards to people with poor or advers credit histories. Yes, the interest rates they charge is very high, as much as 40%, but remember if you do pay off the full amount each month as suggested in this article you will never be charged any interest, and over time you will have successfully undertaken the credit repair process and freed yourself up from the constraints of a poor credit rating.

Credit Repair – Summary

Your credit report or credit file is a comprehensive record of your borrowing and repayment record for the preceding six years. If you are experiencing difficulty in arranging new credit then it is highly probable that the reason is down to errors on your credit report, or a poor payment history. You can repair both of these issues, firstly by pointing out the errors to the credit reference agencies and secondly by creating a new uptodate pattern of credit and on-time repayment which balances out the poor payment history in the past.

Above all, it is important that you act soon. You never know when you might need to borrow money in the future at short notice. If you do not act now and start the process of credit repair you may be unable to borrow in the future when you most need to.

Good luck.

There is a very simple answer to this question. No, you’re not on a credit blacklist. The reason for being so certain about the credit blacklist is in fact a myth.

Credit reference agencies are only allowed by law to contain information about you which is factual in nature. Indeed almost all of the information is compiled from only two sources. The first is the public record, which you yourself have access to and can with a little bit of effort you can check whether it is accurate. The second is source of information is provided directly by lenders and financial institutions with whom you have had some form of credit relationship, either currently or at some time in the recent past.

Credit reference agencies provide a central reference point, also known as your credit file or credit report, for the above information. The information provided is factual and there is no scope on the credit report for offering opinions about whether you will repay the credit they have extended to you.

Actually, the real truth is that most lending decisions made by these companies are based upon a formula for assessing your credit strength. This formulaic approach is known as credit scoring. The credit scoring approach uses information from both your credit application form and your credit report provided by the credit reference agency. It may surprise you to discover that the vast majority of information held about individuals on credit files is of good payment history.

Credit Scoring

So what is credit scoring?

Well, credit scoring is a method established by lenders and other financial institutions to give them an idea as to whether a person is sufficiently good credit risk to lend money to. The credit scoring approach takes information from various sources, some held by credit reference agencies, some publicly available information and any additional information you may have provided from your credit application.

Each individual lending company or financial institution will place a weightings to different parts of the information they hold. These weightings will be based upon extensive research and perhaps even more extensive experience in the field of lending. It is quite likely that each lender has had different lending experiences or are targeting different parts of the lending market and therefore use different weightings.

At the end of this weighting process the lender will aggregate their weightings into an overall credit score. It is this credit score that is usually the determining factor behind their decision to accept or reject your credit application.

It may seem that this process is a dark art, and it is certainly true that the lending company will keep secret the weighting factors used in its credit scoring process as disclosure would encourage unscrupulous applicants fitting their information to the credit scoring weightings to achieve a better than reality score. The key factor to keep in mind is that you simply won’t know for sure. It is possible that the information supplied by you just did not fit the ideal ‘customer profile’ of that lender. In such cases it is unlikely that the information provided by the credit reference agency was not used in this decision. As noted above different companies take different information into account and therefore your application may be accepted by one company but declined by another.

However, should a lender or financial institution decline your credit application they really should tell you what the main reason for your rejection was. If they do not you should write to them enquiring the reason. They are required by law to give you the reason. They must tell you whether their decision was based upon a credit score, information held on your credit file or on their own specific policy. If the decision was based upon your credit report, the lender should also tell you the name and address of the credit reference agency they used.

Your Credit Report

Now for a piece of advice.

Check you credit report regularly!

It is always a good idea, on a regular basis to obtain your credit report. If you wish to know how to do this it is covered in a post on this web site informing you how your undertake the credit repair process. Getting hold of a copy of your credit report is especially important either before you make a credit application or just after a credit application if you are declined credit as a some piece of information held by the credit reference agency.

Remember your credit report will include all the information that any lender or financial institution you apply to may see and the information contained on the report will help you to establish why your application to them was declined. Your credit report will not state the reason you have been declined because only the company you applied to will know this. But if the reason you have been declined is due to adverse credit information contained on your credit file then by reading the file you will at least understand what that adverse information might be. In addition it may be that some of the information included is inaccurate, or in just plain error. If this is the case then there are practical steps which you can undertake to have this information corrected.

Before wrapping this article up there is just one final piece of advice. If your credit application has been declined by a particular lending or financial institution. Establish what the reasons for the application being declined were first and then fix them. Do not be tempted to make repeated applications for credit after you have been declined based on the possibility that should you make enough applications you may just get one approved. Applying for credit is not like job seeking. Each application you make is likely to result in a search of your credit report. As is noted in the article on this website describing the information contained in your credit report these searches will be registered and may well affect the success of all future applications.

Establish why your application was declined and repair your credit standing before making further applications.

Still Think You’re On A Credit Blacklist?

If you are reading this article is may be reasonably safe to assume you have had difficulty getting credit in the recent past. The idea of a credit blacklist that your name is on being the reason behind your problems is seductive. Unfortunately credit blacklists don’t exist and the real reason for your difficulties is probably much more mundane, you either don’t fit the lending profile of the lender you have applied to, or there is a problem with the information contained on your credit report, or a bit of both.

To deal with the former you should seek to understand and in future target your applications to lenders who may well be more interested in gaining your business. The latter is fixable, and you should waste no time in going about repair your credit.

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So What Happens When I Go For The Free Credit Report Offer?

Should you click on a link offering a free credit report then? What’s the angle the company is trying to sell to you? After all free is never truly free is it?

Well you’d be right to ask the question. Of course they are not offering anything for free really. They are taking advantage of your natural concern over the quality of your credit rating, specifically the contents of your credit report. They are in effect attempting to sell you a subscription to their service of providing you with updates to your credit report on a periodic basis, mostly monthly.

The Mechanics Of The Free Credit Report Offer

It works something like this:

You search for the term “free credit report” on the Google search engine.

The results page bombards you with offers relating to the opportunity to get your free credit report and tempt you with a button that says something like – click here to get your free credit report now.

You click and are take through to a page asking for your personal details (necessary of course, for identifying your credit report). No problem you think, and proceed to fill in the details. You submit your details

Next you are taken through to another page in which you are invited to fill in your payment details. Odd, you might think, given that this is a site offering free credit reports. However, you reserve judgement and complete the information.

What you haven’t clearly been told at this point is that the free part of free credit reports is actually a free trial period to a subscription service and that you have had to get through to the payment page before this is made clear to you.

Worse still you have probably had to provide your email address along with your name and address details and missed the opt out of receiving offers from partners, affiliates and other special offers they might wish to promote. Which is of course, marketing speak for getting spam galore from loan companies.

Free Credit Report – The Small Print

Read the small print and the picture comes clear – an extract from one high ranking Google search website – only given to you on the payment details page (no link given as not wishing to provide the company with free clicks):

Offer Details:
Simply click “Submit” on the next page to claim your FREE Credit Report and Score and activate your trial membership in [company name]. After your 10-day FREE trial, the membership fee of £14.95 per month will be charged by [company name] to the credit card you use today, and then automatically charged each month at the then-current monthly membership fee so long as you remain a member. Of course, you can call us within the first 10 days to cancel – you will have paid nothing and owe nothing. Remember, [company name] comes with our guarantee – you can call to cancel at any time and you will no longer be charged.

All suddenly becomes clear. The free turns out to be not so free, in order to get your free credit report you have to sign up, agree to pay, then cancel if you decide you don’t want it. In this case, if you don’t cancel before 10 days are up you commit to paying a hefty £14.95. Pretty steep.

I Still Want My Credit Report – What Else Can I Do?

You see the thing you perhaps don’t realise at this point is that the credit reference agencies, of which there are three principal ones in the UK are required to send you your credit report for a mere £2 each time. The £2 is a fee to cover the administrative effort in locating, printing and despatching your credit report. If you did these each and every month it would cost you only £24 per annum. Less than two months of subscription to the aforementioned company (although of course the company was not mentioned).

What these companies are trying to do is to encourage you to set up a standing order, or in most cases a direct debit to their subscription service and then forget about it. Each month they automatically produce, at very little cost to themselves your credit report, which they most likely despatch to you by email, again an extremely low cost method of distribution. Once you are on their database therefore you become a big profit generator for them. The main cost to these companies is in attracting new subscribers, which is highlighted by the expensive and slick website that is designed to attract you in.

Regularly obtaining your credit report is an activity worth undertaking, especially if you have undertaken the process of credit repair. Getting sucked in to a paid subscription in order to get the information in your credit report, on the back of a claim that appears to offer you a free credit report is not a sensible course of action.

In order to get a copy of your credit report you should contact one of the following credit reference agencies. It is probably easiest to do this via their website, but their contact details are as follows:

Callcredit plc

Consumer Services Team
PO Box 491
Leeds
LS3 1WZ

Tel: 0870 060 1414

www.callcredit.plc.uk

Experian

Consumer Help Service
PO Box 8000
Nottingham
NG1 5GX

Tel: 0870 241 6212

www.experian.co.uk

Equifax plc

Credit Advice Centre
PO Box 1140
Bradford
BD1 5US

Tel: 08705 143700

www.equifax.co.uk

Easy really. In fact almost too easy – a fact the Free Credit Report vendors don’t really want you to know.

Free Credit Report – Summary

So don’t fall for the free credit report offers. Much better advice would be to make a little bit more of and effort, deal direct with the credit reference agencies (avoiding their own hooks to sign you up) and save yourself a hefty sum by doing it yourself.

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How do you know?

What exactly does having bad credit mean?

Well in the normal course of events these questions are usually asked when someone has had an application for credit turned down by a lender or other financial institution. So you now want to know upon what basis they have turned you down for credit.

Did you know that the vast majority of your past financial history is recorded in a central place and made available to all lenders and financial institutions upon request? These reports, known as credit reports are held by credit reference agencies and record all your recent financial activities. If you want to know what’s on your credit report there is detailed article on this site.

Your Credit Report

In brief however the credit report contains details of your individual loans, creditcards, mortgages, and possibly even bank accounts, anywhere in fact where you may borrowed money from a financial institution. In addition, the credit report includes paymet histories, including whether you have been late or missed any payments.

In addition to any loans or other credit matter, the credit report also includes details of any County Court Judgments you may have had issued against you (those that you have not satisfied within the specified time limits, that is).

Now if you were about to lend someone some money wouldn’t you like to find out whether the person you were lending to had any history of not paying the lender back. Of course you would. Well the credit report, held and maintained by the credit reference agencies is the big lender and financial institutions way of doing exactly this check.

When you apply for credit the lender uses information from your credit application to obtain your credit report from one of the credit reference agencies. If there is any adverse information contained on that particular credit report then you may well be classified as having bad credit, or being a bad credit risk. This may well lead to your credit application being turned down; rejected.

Obviously you don’t want this. So what do you do about it? Well, the process is actually quite simple. Before you apply for new credit why not obtain a copy of your credit report from one of the credit reference agencies. By doing this you will be able to see what the lenders or financial institutions see (in fact you get to see somethings on your credit report that they do not get to see too). If there is any adverse information or data on your credit report then you can start the process of credit repair prior to making any application. Seems a sensible approach?

So how do you go about getting hold of your credit report?

The Free Credit Report

Well, the first, and probably most obvious way is to type in “free credit report” to the Google search engine. This will throw up hundreds, if not thousands of companies offering you the opportunity of getting hold of your credit report for free. This obviously sounds attractive, especially because if you do believe you may have bad credit then it is likely that money is something you do not have in abundance and getting something for free is always attractive.

Notwithstanding the free offer being attractive, as you may well expect the free credit report offers are not what they seem, so proceed with caution. What these companies want is for you to sign up for a subscription to there credit information service. These services are useful and the information provided may well be helpful to you, however they are not inexpensive. The free credit report offering is designed to snare you. In any event be careful and you should be OK. If they state they are offering you something for free, then even if you do find yourself providing payment details you will still be able to receive the credit report for free, just remember to cancel the payment details once you have received it or you may well find yourself forgetting and subsequently making payments for the continuation of the service.

Credit Reports And The Credit Reference Agencies

In addition the free credit report is not the only way of getting hold of your credit report. Actually the credit reference agencies have to, by law, provide you upon request with an up-to-date copy of your credit report. Indeed they are not actually allowed to charge you for sight of your own personal report, although they are allowed to charge you a handling fee. In the UK this handling fee is only £2. This is relatively inexpensive and the process does not involve you committing to anything else, just the one-off fee. To get hold of your credit report this way just write to the credit reference agencies enclosing a check for the appropriate fee.

Don’t Worry You Can Fix Bad Credit

Once you have your credit report you will then be able to determine whether you do indeed have bad credit, or a poor credit status. If you do then it would be advisable to commence the process of do it yourself credit repair. This process is not complex or difficult but does require you to be careful and exert some discipline which may well have been lacking previously. Do not worry, most circumstances of bad credit are perfectly repairable, just take it one step at a time.

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Credit repair is something that you may believe you need to engage credit repair companies to do on your behalf. This is not true at all. Credit repair can easily be undertaken by yourself, from getting hold of your own credit report, through to removing County Court Judgments from your credit report. Do not be concerned, all of these matters are quite straightfoward as long as you break down each activity into simple steps.

Credit Cards

1. Get rid of all your credit cards except for one

Having multiple credit cards is both unnecessary and means that the problem of keeping on top of the monthly payments for all these cards is much more burdensome than is strictly necessary. It is easy to close down a credit card account. Just write to the issuer with explaining you no longer wish to continue with their card. You also need to arrange payment or transfer the balance to another card.

2. Always make your monthly credit card payments on time

This tip is probably the most important of all in maintaining a good credit status and ensuring you do not get branded as a bad credit risk. Even if you cannot afford to pay off the balance each month it is incredibly important that you at least make the minimum payment. Each late payment is recorded on your credit report and will count against you should you wish to make another credit application in the future.

3. If possible always pay your credit card balance off in full

This tip ensures you will provide the lending companies with information that implies you are a responsible borrower and would easily be worthy of additional credit in the future. It may not be possible to repay the whole outstanding balance but you should try to pay off as much as possible each time you make a payment.

4. Lower your credit card limits

Remember, these tips are all about improving your credit rating, and making it clear on your credit report that you are reliable and of good credit character. So, as you reduce your overall outstanding credit on your credit cards, why not request your credit card companies lower your credit limit. This has two benefits. First it limits your ability to overextend yourself whilst you are attempting to repair your credit, second it again sends a clear signal to your credit card company and through them to your credit report that you are a responsible borrower whom they should trust.

5. Use your credit card for day to day purchases

If you do not have a significant balance on your credit card but still wish to repair your credit rating then it is advisable to use your credit card to purchase everyday items, such as food and petrol. But the catch is that if you do follow this tip it is critically important for you to repay the whole balance each month. If normally if you paid cash or used a debit card for these items then by using a credit card you are demonstrating that you can responsibly borrow money from the credit card company, but if you fail to pay off the full balance then you run the risk of running up a balance which subsequently gets you into trouble. Discipline is the key.

6. Set up a direct debit to pay your monthly credit card bills

You can usually arrange with your credit card company to deduct a fixed amount, the minimum amount, or even the full outstanding balance each month. If you can’t afford to pay the full amount at the end of each month then it is still worthwhile arranging for the direct debit to take the minimum at least. You can supplement the monthly payment manually, but at least you never get into trouble for having forgotten a payment at all.

7. Check you credit card statements carefully

Are all the charges correct? Are there charges where there should not be? Unless you read your credit card statement carefully each month you may well not find errors at the right time. If for instance the credit card company has charged you for late payment when you did not make a late payment you must get this corrected immediately before the error gets translated onto your credit report.

Your Credit Report

8. Obtain your credit report regularly

This step is very important. It is easy to get hold of your credit report. Try typing in “free credit report” to Google search and then follow any one of the links that come up as a result offering you your free credit report. Alternatively you can write to one of the credit reference agencies, together with a small administrative fee, currently £2 in the UK, and they will send your credit report to you. It’s easy, don’t neglect this tip. Your credit report will inform you whether others see you as a bad credit risk or not.

9. Read through your credit report carefully

It may surprise you but your credit report may be riddled with mistakes. Obviously you don’t want to find that you are branded a bad credit risk based upon information that is incorrect. Read through your credit report carefully, checking each and every bit of information, including your payment histories. If there is a mistake on the credit report then you should write to the credit reference agency explaining the mistake and requesting that the investigate and correct the matter. They are required by law to investigate and respond to you within 28 days either acknowledging the error and correcting the matter, or giving you reasons why they do not believe a mistake has been made.

If you do discover a mistake then you would be wise to ensure that all the credit reference agencies correct the mistake by writing to them all. You do not know which credit reference agency your lenders will use, therefore it is not sensible to correct a mistake with only one agency without checking if the others have made the same mistake.

Bills

10. Always pay your household bills on time

There is little point in you concentrating hard on repaying your credit card debts, or other loans if at the same time you are neglecting to pay your every day household bills. Utility companies will routinely apply for judgments against you if you do not make regular payments. If there is insufficient money to go around then you need to discuss this with the relevant parties. Do not neglect one party for the sake of another. Don’t hide your head in the sand. If you have money problems then make sure the relevant parties are aware of your difficulties and of your attempts to make payment eventually.

These tips may seem obvious, but this is the truth about credit repair. The steps you take are not complicated, or even particularly onerous, they only require patience and discipline. The important thing is not too leave it until it is too late. Start today!

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You may not have realised this but most credit applications that you make are not decided upon by a human being. No. Actually it is quite likely your credit application will be assessed based upon whether your credit score has exceeded a certain threshold or not. If not then your credit application will be declined without human intervention.

So before you make any further credit applications it would be a good idea to see if you can find out what your current credit score. Where do you look to find your credit score. There are two easy and reliable sources of obtaining your credit score free.

The first method is simply asking a current debt provider what your score is. This may sound slightly too obvious, but actually there really is no reason why the information that the debt provider holds in respect of your credit standing should be withheld from you. Indeed it may just be necessary to ask in order to get hold of up to date information.

The second method of obtaining your credit score free of charge is to utilise one of the many free offers available on the web. Just type – free credit score – into your search engine and you will quickly locate any number of offers to provide you with the information free of charge.

You will almost certainly have to provide some personal information and you may well feel as though you are signing up for a subscription service but if you are careful and cancel any commitments once you have obtained the information you sought you really should have no problems.

Hopefully you will find this information useful in attempting to obtain your free credit score. Remember, given the impact the credit score has on your credit applications it really is a good idea to establish your score in advance. Knowledge is power!

Since credit history is so important, obtaining copies of your credit report is not a one time process but something that should be done on at least an annual basis. This is especially true in these times when credit repair is often necessary and identify theft is such a significant problem.

Credit reports are available for a fee that ranges from $7 – $10 but since September 2005, the federal Fair Credit Reporting Act has required each major credit bureau to provide every consumer one free copy of their credit report each year. Free credit reports can be requested by telephone by calling toll free (877) 322-8228, by Internet at www.annualcreditreport.com or by mail at Annual Credit Report Service, Post Office Box 105281, Atlanta, GA 30348-5281. Credit bureaus are not required to provide free FICO scores but these may be obtained at nominal cost.

In addition to the annual free credit report, anyone who has been denied credit based on credit file information, who is unemployed and planning to apply for a job within 60 days, who receives public assistance or who believes they are a victim of identity theft or fraud are by law entitled to a free copy of their credit report.

The three major credit bureaus, Equifax, Experian and TransUnion must and should be contacted separately to request credit reports for reports other than the free annual reports. Each bureau maintains a web site where consumers can find complete information on how to request credit history. As a minimum for identification purposes each require the full name, date of birth, social security number and current address of those requesting copies of credit reports. Some require documentation like a photocopy of a driver’s license or utility bill and may require other information such as the amount of a monthly mortgage payment.

Credit history has never been more important and every consumer should obtain and review their credit history at least once a year. Procedures exist for correcting errors that are sometimes discovered when reviewing credit reports.

An individual’s credit history has key factors, and by using this data, credit-reporting agencies calculate and generate a credit score. This number will decide whether you are a good credit risk to obtain credit, purchase homeowners and/or auto insurance or even employment. With higher credit scores, consumers pay lower interest rates, and save on insurance premiums. Credit is denied to applicant(s) who do not meet the minimum credit score requirements. Marginal borrowers, who are approved, will pay higher interest rates, and/or higher premiums for insurance. In some cases, employers will not hire an applicant due to their credit-bruised history.

Trans Union, Experian, and Equifax are major credit reporting agencies. These standardized reports itemize everything pertaining to an individual’s personal credit history, receiving the documented information monthly, directly from the issuing company. The facts that are charted on this concise report are: the date an account was opened, the high credit limit, current balance, current monthly payment, term if it is applicable, and the minimum of a twelve-month spread of a pay history, demonstrating the individual’s ability and willingness to pay.

The payment history is given the most weight in scoring, and if payments are late, they will be broken down to 30, 60, 90 days late and will stand out on the report as a red flag to an underwriter, who is the authority that will approve the credit decision. How many months was the debtor late and why they were late, are the questions the underwriter will ask. Will the problem happen again, or is this a one-time occurrence? The more days a consumer is late, and the total numbers of months of late payments, are factors that could make or break a credit decision. Negative reporting always slashes the credit score. If the consumer is looking to buy a car or home in the near future, they will need to repair their credit.

Utilization of credit accounts is the next important factor used to determine ongoing credit worthiness. Too often consumers will borrow up to the high-credit limit on revolving trade lines or go over the high-credit limit. This abuse of credit will take precious points off a credit score. Then, if there are 30, 60, or 90-day late payments noted on the account(s), scoring plummets even more. Always maintain open revolving accounts at fifty percent utilization or less. For instance, if the credit line is $1,000 and a consumer uses $499 on the credit line, this is acceptable and will have less effect on the score.

In addition, if revolving accounts have low balances or no balances and the accounts have been open for many years, this could add points to the credit score, providing payments are on time. It is best to close all revolving accounts that have no balances. An underwriter could review those as potential debts. All closed accounts will still report on the credit report and in time will bump up the credit score.

To conclude, an individual’s present credit history does predict the future! The credit history goes through the reporting agency’s filters; the results are then, compared to the credit risk models, and technology scores. The higher the score, the more likely the lender will be paid, and that is what it is all about!

Step One:

By utilizing this form, you will find out the reason or reasons for the turndown, and the credit-reporting agency that supplied the negative credit information. There should be a phone number to call, whereby you can receive a free copy of your credit report, the one used to make the adverse credit decision. Even if you know why you were denied, get a copy of the report because there are always errors. Humans do the data entry and humans are not perfect.

Step Two:

Once you receive your credit report, carefully, line by live, review all the data.

Step Three:

On a separate piece of paper write down all the items that are wrong.

Step Four:

If it details bills that are unpaid, and you have paid them, find the documentation to prove they are paid. If payments report late, call the lender, if you paid the bill on time. Again, humans do data entry. Make sure all accounts are reported accurately. If there are open credit cards with no balances, close them. Use a fine-tooth comb because this is your financial future. Credit is a very important asset to have. Credit repair is one-step at a time to recovery!

Step Five:

With your credit report, there should be a dispute form. On that form, write down the information that needs correcting, and supply the paper trail that proves the bill or bills were paid. If an Item was in a bankruptcy, provide the bankruptcy paper that lists the creditor, and send the discharge paper. Do not send originals; send copies!

If there are collections and judgments and you have no idea what they are, dispute them. The credit reporting agency will notify the company or party, and these entities are given a certain period-of-time, to provide the evidence of the collection or judgment. If they do not respond in a timely manner, according to the Fair Credit Reporting Act, it warrants removal from the report. Every minutes counts!

Step Six:

Send the dispute form.

Step Seven:

Perhaps the problem is late payments due to forgetting to pay. The lender can draft your bank account, keeping you payments on time. If cash is tight due to a change in your financial status, talk with the lender and work something out. Communication is very important. Sometimes a lender will offer a settlement.

There is one more step, Step Eight, in the credit repair process. Go online and find Equifax, Experian, and Trans Union. All three reporting agencies need to be corrected, if you are going to repair your credit. How foolish to fix one, when the other two are wrong. I know this is a climb, one-step at a time, but in six months, you will find yourself in a better position!

Credit repair is not easy but your future depends on credit. The longer you put it off, the longer you will be credit poor. Take the first step in repairing your credit, and you will be headed in the right direction!