Your credit report is just that, its yours. It is information that is gathered about how you handle your credit commitments. That includes bank accounts, credit cards, loans, hire purchases, mobile phone contracts, store cards, catalogues, and some utility bills. All credit companies will report how you pay them each month to your credit report. If for whatever reason you do not pay on time or you pay late, the company will report a negative mark against your credit report which the other credit companies will see when they run a credit check on you and that could affect their decision to lend to you.
You should be aware of this information, and regularly check to see how you are being reported on as this can affect your chances of getting further borrowing.
Now the frustrating part of your credit report is although it is about you and your information, to obtain an accurate update on your report you will need to pay a 3rd party to obtain this information. There are various companies who can offer you this information, the easiest ones to access are the free versions but because they are free the information they hold is not necessarily update and maybe a few months behind. If you want a truly updated copy of your report then you are best heading for the paid for companies such as Experian and Equifax or, my recommendation, Check my file. Checkmyfile, offer you reporting on 3 separate credit companies in one place – These include Experian, Equifax and Transunion, all of who are the reports that mortgage lenders will check when you apply to them.
I do have an affiliation link below to CheckmyFile and is the one I personally use to keep an eye on my own report. If you are new to them they offer you the first 30 days free of charge and then charge a monthly fee after that. To set up access to your credit file you will need to set up and account and give them your full name, date of birth and 6 years worth of address history. It is really important here that you are honest about your address history and so that you get a true picture of any credit commitments you have had over the last 6 years.
Once you have access to your report, the main thing to consider when checking your credit report is your payment history for each credit commitment you have. This works on a on a traffic system- if you have a green dot under the monthly payment then the payment was made on time and in full. An Amber dot means that the payment was late – the payment was made after the due date but before the next payment was due. And finally a Red dot means that the payment wasn’t made at all during the month. There is often a number associated to the late or missed payment as well, showing how many months that payments haven’t been made.
One thing about your credit report is we are led to believe is that our credit Score, is the most important thing. But it really isnt! Your score is not actually considered by lenders, in fact they can’t even see your score when they check your report. Your score is determined by each credit report company and what they deem to be important not what lenders will consider. As a general rule your credit score is determined by the number of credit accounts you have, how much of that credit you are using, if you have made payments on time and in full, if you are registered on the electoral role at your current address, if you have changed address a lot in the last 6 years and a few other things as well. Your credit score will also go up and down based on a variety of transactions on your report, so for example if you take out a new credit commitment your score can go down, or if you pay one off it can go up. if you carry out a comparison check on car insurance this can also affect your score because every company that shows up on your comparison list will carry out what we call a soft foot print to check you are who you say you are.
Mortgage lenders will carry out a scoring process but this is different to the credit report companies, they use some of factors the credit report companies use but they also score you based on how much you can afford on a mortgage, how big your deposit is, how long you are taking the mortgage over and other things that we will go into in a other post.
Your score is a good indication of activity on your report but its the information that is within it that Mortgage lenders are looking at so make sure you check this and not just your score.
