How to improve your credit rating

When you apply for a mortgage, the lender will want to make sure you’re able to afford the repayments and can manage your finances well. One of the things they’ll look at will be your credit score. You can check your credit score for free via sites like Experian. If yours isn’t as good as it could be there are some easy steps you can take to improve it.

One: Check it’s correct

It sounds simple but checking your credit report is accurate could help to improve your score. Simple mistakes such as an incorrect address or listing accounts as open that you have closed could be having a significant impact.

Two: Be careful of hard searches

When you apply for credit, the lender or provider will perform a search of your credit report. This is known as a hard search. If you apply for lots of loans or credit cards over a short period of time, your mortgage lender will see this on your report, and it may set off alarm bells.

Three: Register to vote

Yes, registering to vote at your current address can add points to your credit score. If you’re not registered to vote, do it now!

Four: Add an explanation

If you have a valid reason why your finances took a turn for the worse at some point in your past you can include a note on this, called a notice of correction, in your report. If you were ill for a period, for example, and fell into the red, you can explain this.

Five: Don’t miss payments

It’s the simplest advice but also the most important. When you apply for a mortgage, the lender wants to know you can manage the repayments. If you’ve missed lots of loan or credit card repayments in the past, it won’t look very good. Do your best to make your repayments on time and within the calendar month. Another tip set your direct debits to first of the month and not last day of the month.

If you need Mortgage advice, please call us and book in for an appointment in our Manchester Piccadilly office.

We Know Mortgages Ltd do not provide a Credit Repair service, the information provided is for general use only and so for further guidance we recommend you read the more exhaustive information provided by The Money Advice Service.

A mortgage is a loan secured against your home or property. Your home or property may be repossessed if you do not keep up repayments on your mortgage.