  What is a credit rating?They hold information on your credit situation, and will know about any overdrafts, credit cards, loans, mortgages and credit contracts you hold. They also have details of your address, where, if anywhere you are registered to vote, and the amount you have repaid of all of your credit commitments over the last few years. They will also know if you have repaid all of your loans on time, and will give you a credit score, based on your credit worthiness according to their systems. How does a credit rating affect me?When you go to borrow money, or obtain credit, the majority of lenders will consult one of the three credit ratings agencies and ask for your credit score. They will then use this score to decide whether to lend you money, and then at what interest rate. If you want to borrow money in the form of a loan, you'll notice that sometimes you are offered an interest rate higher than the one advertised. This is because the rate advertised is only offered to customers with the very highest credit ratings. Lenders charge more to customers they see as being a higher risk of not repaying the money they borrow, based on their credit rating. Who checks for my credit rating?You'll be amazed at how often in a year your credit rating may affect the financial decisions you try to make. Whilst a mortgage and loan applications are obvious examples of credit applications, you'll also have your credit rating checked when applying for a credit card, a mobile phone contract and even when you take out an interest free repayment deal with a shop. How can I check my credit rating?All three credit agencies offer a service online where you can check your credit rating at anytime, although these are usually free for 30 days and then cost around £10 a month. For £2 you can write to any of the credit agencies at any time and request a copy of your credit rating. To write to an agency use the addresses published below: Equifax Ltd Credit File Advice Centre PO Box 1140 Bradford BD1 5US 0844 335 0550 Experian Ltd Customer Support Centre PO Box 8000 Nottingham NG80 7WF 0844 481 8000 Callcredit Plc Consumer Services Team PO Box 491 Leeds LS3 1WZ 0870 060 1414 |
