Practical tips to help you improve your credit rating and avoid expensive high interest loans
In the ‘good old days’, to get a loan you would meet the bank manager and they would make their decision to lend based on many factors, your credit score is only one.
Though in today’s world of ‘automation’ and minimising costs, lenders rely heavily on credit scores as a major way of deciding whether to lend or not. Your credit score is like an exam grade; so:
The higher you score – the greater the number of lenders who are likely to grant you a lower interest rate loan.
The lower your score – you will be more restricted to ‘bad credit lenders’ who are more expensive.
Experian provides a good explanation in the graphic below:
The score you need for a loan will vary depending on the specific lender; though many lenders do not just look at this, they will also look at your credit history to see if it looks acceptable to them.
Your score is made of 5 categories:
For hints and tips about boosting your score, check out the following Money Saving Expert article: Credit scores: Boost your credit rating – MoneySavingExpert
The Money Advice Service explores in great detail in the following article: How your credit score affects the cost of borrowing
To check the current level of your credit rating to see which options are available, we strongly recommend heading over to the Checkmyfile website to view the UK’s only multi-agency credit report.
Once there you will have the option to sign up for a one-off FREE 30-day credit report. To view your one-off 30-day FREE credit report, please click here. Alternatively, if your FREE period has expired, you can order a comprehensive credit report for a one-off payment of £19.99 by clicking here.
Unfortunately, if you have sub 600 poor credit score, apart from friends and family, it is only the ‘poor credit’ lenders that are available for a loan.
As you have probably guessed, we are a loan broker and specialise in online guarantor loans. We have included a lot of information on our site to help you to decide whether or not this is the right type loan for you, as well as a compare loans page to quickly browse the various options: