What Happens To Your Credit Report When You Move Country?

Posted by Kirstie Day in Personal Finance on 27 June 2018

Moving from one country to another results in a lot of changes and new things – a new place and culture, new job, new people and in some cases even a new language. However, one thing lots of people do not realise is that you will also be starting afresh when it comes to your Credit Report. Credit Reports and the information they contain are country-specific and do not follow you from one country to another.

This can make getting initial access to even basic credit facilities such as a contract mobile phone or bank account quite problematic, and without an easily-accessible (local) credit history from which lenders can draw information from, more substantial borrowing in the form of credit cards, loans and mortgages could prove even more difficult to get.

Moving from the UK abroad

Depending on where you are heading, you might find some countries have very similar credit systems to the UK, whereas some are completely different. While that means you might notice some similarities in the way that data sharing and credit reporting systems themselves work, your information will not be carried over.

Research the credit scoring system used in the country you’re heading to in advance and see if there’s anything you can do before you get there or as soon as you arrive to make the transition that bit easier. It could be that your UK bank has a presence in the country you’re moving to (or vice versa), in which case getting a bank account or credit card could be made that much easier.

You should also check what sort of Electoral Roll system is in place, and if you’re able to register in advance.

Should I keep accounts open or closed?

If you’re only moving abroad temporarily, you may find it more convenient to keep your UK accounts open and active so that they will continue to be reported on your Credit Report. Once accounts have been settled and closed, they will remain on your file for 6 years before being automatically removed from the Credit Reference Agencies’ databases.

By keeping accounts open, these will be waiting for you when you return to the UK and will stop you having to re-build your credit profile from scratch. If you are only moving abroad for a few years, we would recommend having a UK-based address where you can hold your credit agreements, and if necessary request online statements only rather than paper statements. You might consider using ScanMyPost as a service address, which will reduce the risk of post falling into the wrong hands and that you can access paper statements online whenever you wish.

It is also important to bear in mind that your Electoral Roll listing is a vital piece of information on most score cards used in the UK so if possible, remaining registered to vote at a UK address will help retain your rating. If this isn’t possible, make sure you’re registered to vote as soon as you’re back in the country to minimise the time it takes to get your creditworthiness back into good shape.

If your credit agreements are left active, being out of day-to-day contact means that there is a very slim but slightly increased risk of fraud, so routinely monitoring your credit report could help identify any suspicious activity and stop it dead in its tracks.

Keep evidence of your credit history

Whether you are only intending on moving abroad for a number of years or as a permanent move, it may be worth getting a copy of your Credit Report before you leave. While your credit history will not follow you from country to country, you would be able to provide any future lenders with this information to demonstrate your payment habits from the UK – thought whether they would be able to use it in a lending decision is questionable.

If you do decide to close your agreements and move abroad for a considerable amount of time (more than six years), it is worth noting that you would experience the same issues on your return as someone starting their credit history from scratch.

Moving to the UK from abroad

As with Brits moving abroad, anyone coming to the UK for the first time will do so with an empty credit history, so you’ll essentially be starting from scratch. As such, one of the first things to do is to start building your Credit Report if you intend to eventually take out a loan, mortgage or other form of major finance at any point.

Taking some simple steps to establish your credit history in the UK should help you gain access to credit faster, and the sooner you can make a start the better. While building a comprehensive credit profile can take time, the most important thing is to start small and ensure that your agreements are well-maintained.

Registering to vote

If you are moving or have moved recently to the UK from an EU/qualifying Commonwealth country, you will be able to register on the Electoral Roll at your new address. An electoral roll listing is an important part of your credit file, with lenders sometimes refusing to provide credit if they are unable to locate an individual on the register.

Once registered and this is reflected by the Credit Reference Agencies, this will have a positive influence on your credit rating and greatly improve your chances of being accepted for credit.

If you’re living in rented accommodation, you may be able to build your credit history if your landlord has signed up or will allow you to sign up to a rent reporting scheme. In recent years these have become more mainstream, but at present most only report payment data to one Credit Reference Agency. That means if the lender uses data from any of the other agencies, they will not see this information on your file.

Start out small

Even with a limited credit history, you should be able to establish a line of credit to build up a credit history. This can be a credit builder card or a bank account with a small overdraft facility. By maintaining these agreements, you will build a period of good payment history and stability which is what a lender would be looking to see when assessing an application for credit.

Especially during these early days it’s important to keep on top of payments; most lenders retain the right to withdraw credit if the terms of the agreement have been breached, and you’ll have an even harder time trying to get credit with negative information on your file.

It is possible that you may be required to provide further ID and proof of overseas residence, however this would be at the discretion of the lender. If you are declined for a credit agreement, do not be disheartened – it may be that on this occasion you have not met the lenders specific criteria. However, avoid making numerous applications in a short space of time as this can look desperate and a lender may be weary of you as a result.

Check your Credit Report

Wherever you move to, as soon as you’ve started to establish a credit history, you should look to get a copy of your Credit Report. This will help keep an eye on how your repayments are reported, your Electoral Roll status, and any financial associations that you might gain as part of your move. Even if at first there is a lot of information missing, you can use that as a checklist of things to do to get started.

If you have a UK address, you can use checkmyfile to see what information is being reported on you by 4 Credit Reference Agencies, not just 1, letting you see what lenders see. You can try checkmyfile FREE for 30 days, then for just £14.99 a month afterwards, which you can cancel at any time.

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