"This default is destroying my credit score - how do I get rid of it?" This is a very common question! It's sometimes asked when people's finances have improved and they are trying to clean up old problems on their credit history as fast as possible. Or sometimes the default feels unfair for some reason. I will look at various cases to see what - if anything - can be done for each of … [Read more...]
Credit Ratings
There is a lot talked about credit ratings on the Internet but it can be very confusing and sometimes even wrong!
If you can't make the proper payments to your debts, your credit rating will suffer. But different debt options affect your credit score in different ways, so I've written these articles looking at the details of each situation.
And most importantly, when will your credit rating improve and what can you do to help this.
See The top ways to check your credit records for details.
The best free ways to check your credit score
Keeping track of your credit record is smart, but how do you go about it? With more than a dozen ways to check your credit record in the UK, it can get confusing. So, what are your options—and which are the best free ones? And is it ever worth paying for "extras"? Do credit scores actually matter? Not really. There is too much hype about credit scores. Lenders never see the score you see … [Read more...]
“Will paying off debt improve my credit rating?”
Will your credit score improve if you can clear some debts? The answer is "Yes sometimes!": it will go up if the main problem with your credit score is credit utilisation - you are using too much of your credit card limit; it may go up a bit if the debts you will be paying off are defaulted or are in payment arrangements, but not a lot. Your credit score isn't the only thing that … [Read more...]
Paying a defaulted account & your credit score
A reader asked if starting to pay a defaulted account will help his credit rating. Paying defaulted debts may improve your general credit situation, making it easier for you to get a loan, a mortgage or a credit card in future. That credit score number isn't the only thing that matters! But if you have expensive debts that you are still repaying as normal, such as credit cards, it's usually … [Read more...]
What should the default date be & when will it disappear?
A default hurts your credit score, but how long for? That depends on the default date recorded on your credit file. If a the default date is too late, it harms your credit score for longer than necessary. The Key Rule to remember is "A default drops off after 6 years". This always happens, regardless of whether: you have repaid it in full you made a partial settlement you are still … [Read more...]
“Will a credit builder card improve my score?”
Four million people in Britain have a credit card specifically aimed at people with a bad credit rating. These cards have interest rates of 30-70%. A standard interest rate on a normal credit card is about 20-28%. Brands include Vanquis, Capital One, Aqua, Ocean, Marbles, Zable and 118. Some normal credit card lenders like Barclaycard have a specific bad credit product available. They are all … [Read more...]
Can I get a new mortgage fix with poor credit?
A couple of readers have asked about mortgage fixes when they have a poor credit record or simply a lot of other debt: Ms A: We are in a DMP and we were told it would make it very hard to remortgage. So we are now on Santander’s SVR and it’s over 7%. Can we really just ask them for a new fix and they won’t say no? Mr B: I'm worried about talking to Nationwide when our current mortgage fix ends. … [Read more...]
How does a DMP or a payment arrangement affect your credit rating?
A debt management plan (DMP) is a good debt solution for many people who can manage to repay their debts if interest stops being added. If you are trying to decide whether you need one, you may want to know how bad the effect will be on your credit file, and how long it will be before your credit rating recovers. There isn't a simple answer: DMPs are used in a lot of different … [Read more...]
Identity theft – what you need to do
This article grew out of a reader's question. Mrs J, asked: Since February my husband has started to receive letters from WageDay Advance, Satsuma and QuickQuid saying that he has loans with them that need repaying. He doesn’t have any loans. We have sent Prove It letters to all three. We have now had letters saying that WageDay Advance and QuickQuid have passed the account to debt … [Read more...]
How to repair your credit record after bankruptcy
Bankruptcy badly affects your credit record for six years. This article looks at what should show on your credit record after you are discharged from bankruptcy. For almost everyone, discharge happens after a year. But if lenders don't record bankruptcy and your discharge correctly, they will continue to damage your credit record for longer than they should. Even if you … [Read more...]