What Credit Searches Mean

Posted by Kirstie Day in Credit Reports on 25 April 2019

One of the most commonly misunderstood aspects of Credit Reports are the credit Search Footprints left on your report whenever someone accesses your file.

One popular misconception is that if a lender sees too many searches during a credit check, they won’t lend to you. In reality, you’d have to make an alarmingly large number of applications for that to happen and in some circumstances (if you don’t have much of a credit history), some lenders might even see a few searches as a positive, because it shows you are at least somewhat credit active.

Credit searches are nothing to fear, but it’s important to understand what each type means for you and your report if you want to get a better idea of how your information is assessed.

How to see Credit Searches

You’ll be able to see all the Credit Searches carried out on your report during the last 12 months on the Searches tab of your checkmyfile Credit Report.

Searches can’t be carried out without your prior permission, so if you spot anything that you don’t recognise, it could be an early warning sign that your details may have been used for fraud.

You can try checkmyfile FREE for 30 days, then for just £14.99 a month afterwards, which you can cancel online, by phone or by email.

Where do credit search footprints come from?

Every time your Credit Report is accessed (either by yourself or someone else) a footprint is left as a log of who has reviewed it. Importantly, only you can see who has accessed your file, but other searchers may be able to see when you’ve applied for credit.

Prospective lenders aren’t the only people that can search your Credit Report: increasingly employers, landlords and even insurance providers may check your Credit Report to verify the details you’ve given them, which is why it’s ever-important to make sure the information that appears on your report is correct.

There are 3 different types of search and not all of these would have an impact on your score: Audit, Enquiry (soft search) and Application (hard search):

Audit searches

Audit searches are left whenever you check your own Credit Report and can only seen by yourself and Credit Reference Agencies. Lenders will not see this information and it is not assessed as part of any application. You can check your own report as many times as you like without it affecting your Credit Score.

Enquiry searches

Enquiry Searches (soft searches) are commonly carried out to verify your details, including name, age and address history. This type of search won’t show your credit history, and instead only contains your Public Information, including your Electoral Roll listing or if you have any Court History or insolvencies in your name.

For that reason they are commonly used as landlord checks or credit checks carried out as part of a job application. Soft searches can also be left when you check your own Credit Report or if you have been preapproved for a credit agreement.

When using insurance or utility comparison or sites, providers usually carry out an Enquiry Search for the same reason, which can lead to multiple searches appearing on your Credit Report at once. This is something to be aware of, but not worried by. In some circumstances, a provider may follow up with an application search if you want to use their service and pay monthly.

Like Audit searches, Enquiry Searches will not affect your score or ability to take out credit and cannot be seen by lenders.

Application searches

Application Searches (hard searches) are most commonly carried out when a lender needs to check your Credit Report to make an informed lending decision based on your existing Credit History.

This type of search remains on your Credit Report for 1-2 years, depending on the Credit Reference Agency used to run the search. Experian tend to report the information for a year, whereas Equifax and TransUnion typically hold this information for 2 years.

Once this period has elapsed, the information is automatically removed from your Credit Report by the agency. By keeping previous searches on your file for a specified time period, this helps paint a picture of your recent financial history and can help lenders decide whether they would be willing to lend to you.

As mentioned earlier, if you accumulate an unusually large number of searches in a short space of time, this can have a negative impact on your Credit Score and the likelihood of getting accepted for credit. Lenders may see a large number of Application Searches as an act of desperation to obtain credit as it could indicate you’re undergoing a period of financial hardship, which could affect your ability to make repayments and may decline you on this on the basis.

It’s also worth remembering that although lenders can see when you’ve made an application for credit, they won’t see whether or not you’ve been accepted. So while you won’t be turned down just because you’ve been declined somewhere else, you might be turned down if lenders think you’ve borrowed a lot in a short space of time; it can take up to two months for a new credit agreement to appear on your Credit Report, and if all they can see is a large number of new applications, this could influence their decision.

At worst, too many applications could trigger a fraud warning on your Credit Report, as it could look like someone is attempting to use your information to get access to as much credit as possible.

Which credit searches can lenders see?

Lenders can only see ‘hard searches’ carried out on your Credit Report. These are usually carried out by prospective lenders that need to gain access to your full Credit Report to assess your credit history, in addition to the address and personal information found on a soft search. As mentioned earlier, some insurance brokers may conduct a hard search on your file when creating a quote, but they are in a minority.

Debt collectors’ searches will also be visible to lenders and in many cases will harm your chances of getting accepted for finance. Without wanting to state the obvious, if lenders see evidence of debt collectors attempting to find information about your credit and whereabouts, it gives the impression that you may have had trouble making payments on previous agreements.

How many searches should there be on my Credit Report?

There’s no exact answer to this, but on average most people will have around 10-12 credit searches of varying type appear on their report a year. The main thing to remember is that you shouldn’t be worried about accumulating too many if you’re shopping around to find the best rates for finance. In some cases, lenders might even see a lack of searches on your report as a sign that you’re not particularly credit active, which they might find off-putting.

As long as you don’t feel afraid to apply for finance, you should be fine - that way you won’t end up with too many or too few searches.

The amount of searches on your Credit Report is just one of many things that lenders might take into consideration when you’re applying for finance; for the best chances of getting accepted, you’ll need to make sure all the information on your Credit Report is correct and up-to-date.

If you haven’t already, you can try checkmyfile FREE for 30 days and then for just £14.99 a month, which you can cancel at any time. You’ll get full access to the UK’s most detailed Credit Report, letting you see what lenders see.

This article was updated 25/04/19 by Jamie Mackenzie Smith

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