What Lenders Want To See On Your Credit Report

Posted by Sam Griffin in Credit Reports on 2 May 2019

Your Credit Report holds a huge amount of information about you and your past relationship with credit. It’s collated from a wide variety of sources, is always changing and plays a major part in any lending decision - but you shouldn’t be afraid of what it shows.

In fact, knowing what information is held about you and what prospective lenders are looking for in an ideal customer could help improve your chances of being accepted next time you apply for any sort of finance or credit agreement.

Checking your own Credit Report will also allow you to verify that everything being reported is correct, as although rare, errors do happen.

Here are the main elements you should check:

A Good Payment History

In an ideal world, your payment history for old and existing credit agreements would show a sea of green ‘OK’ markers. These show that the required payments were made on time that month, and collectively demonstrate that the account has been well-maintained.

It’s not just positive information that is reported though. Late payment markers are a fairly common occurrence on Credit Reports and allow prospective lenders to see if you’ve had any problems meeting repayments in the past. Just how much of an impact this has on your Credit Rating will vary, depending on how late those late payments were.

The odd late payment shouldn’t have too much of an effect, assuming the majority of your accounts are all paid on time, but anything more than 1 month late and you might start to see some lenders get twitchy.

Account information is generally reported for a period of six years, and the recency of any information will also have a bearing on the impact it has.

This article will give you more detail on the types of payment marker that can show on your Credit Report.

That you are ‘credit active’

As well as looking for evidence of how you’ve managed credit agreements in the past, lenders will also check to see whether you are credit active. This is another indicator of your relationship with credit. For example a credit card provider might want to know if you’re likely to use a card if they issue one, rather than simply leaving it in a kitchen drawer for emergencies.

Being credit active (as long as you pay everything on time) will also ensure that you will be able to demonstrate a consistent and recent record of being creditworthy.

We wouldn’t recommend taking out credit for the sake of it, but used in the right way it can help.

If You Own your home

Whether or not you own your home isn’t something that is specifically detailed on your Credit Report, but any mortgage account will be reported (and usually by more than one Credit Reference Agency).

Some lenders may look at a well-maintained mortgage more favourably than other types of account and though owning your own home isn’t something you can change overnight, as a general rule, credit ratings go up as you get older and having a mortgage often forms part of that cycle.

With any mortgage, it’s vitally important that all repayments are made on time. While a prospective lender might be prepared to ignore the odd late payment on a store card, it is unlikely to take the same view if there are late payments recorded against a mortgage.

Correct Public information

In addition to the information that shows how you have repaid existing and previous credit agreements, ‘public’ data is also reported on your Credit Report.

Some smaller lenders, employers and landlords can often only see this level of information, which largely consists of the Electoral Roll, Court Information and Insolvencies.

Don’t underestimate the importance of being registered on the Electoral Roll at your current address: it makes it easier for anyone checking your Credit Report to verify who you are and where you live and demonstrates stability. As such, the longer you’ve been registered at your current address, the better.

Any previous addresses you’re linked with will also appear on your Credit Report, often even if you don’t disclose them. To make it easier for lenders to find the information they need, it’s important that you provide your addresses in the same, consistent format.

Other people

It’s not just your own financial history that can determine the outcome of a new credit application: anyone you are financially linked to on your Credit Report will also be assessed, and can have a positive or negative impact on the outcome depending on their own credit history.

It’s important to check this section carefully, as financial associations don’t end just because a relationship does. If you do find an association that is no longer applicable, you can ask to have it removed by lodging a Notice of Disassociation at the relevant Credit Reference Agency.

See How You Appear to Lenders

Before you apply for credit it’s important to check your Credit Report for yourself to make sure everything is appearing as it should be so that know exactly what a prospective lender will judge you on.

If you haven’t already, you can try checkmyfile FREE for 30 days. You can cancel anytime online, or via freephone or email. After the free trial, it costs £14.99 a month until cancelled.

The Advantages of a Multi-Agency Credit Report

These days your Credit Report can be checked for any number of reasons throughout the year, including background checks during job applications, landlord checks and even from insurance or utility providers when you shop around for quotes.

Published on 17 May 2019 by Paul Anderson Riley

Full Article

What Credit Searches Mean

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

Published on 25 Apr 2019 by Kirstie Day

Full Article

How to dispute an account error on your report

Whether you’ve been turned down for credit in the past and have checked your Credit Report to make sure there’s nothing there harming your chances, you’re checking ahead of making an application, or you’re just looking to make sure everything is as it should be, there’s never a good time to find a mistake with the information on your report.

Published on 17 Apr 2019 by Kelly Luff

Full Article

Your Rights When Cancelling a New Credit Agreement

For most people applying for credit the main concern is whether or not they will be actually get accepted. But occasionally a change in circumstances (or even just a little time to reflect on your purchase) means that a bigger concern might be whether you can change your mind and withdraw from a credit agreement (be it a credit card, personal loan or other credit facility) after it’s been granted, potentially preventing you from taking on additional financial responsibility that you no longer want or need.

Published on 18 Mar 2019 by Tom Magor

Full Article

Creditworthiness and Affordability – Which is Which

When reading the small print on most applications for credit, you’ve probably noticed two words regularly popping up: Creditworthiness and Affordability. Both of these measures are used by a vast majority of lenders when assessing your application, so understanding what each one means goes a long way to explaining why you may or may not be accepted for credit.

Published on 22 Feb 2019 by Ben Tumilty

Full Article

What Information Is On My Credit Report?

If you’ve ever taken out a loan, credit card, or other form of finance, you’ll know that the difference between acceptance and rejection relies heavily on the outcome of what the lender finds when it checks your Credit Report.

Published on 4 Jan 2019 by Paul Anderson-Riley

Full Article

Can Right to Erasure Get Rid of Bad Credit History?

General Data Protection Regulation (GDPR for short) was introduced on 25 May 2018 and unless you’ve managed to avoid the internet and checking your emails completely for the past year, you’re likely to have been bombarded with messages from nervous sounding websites updating their data policies.

Published on 3 Jan 2019 by Jamie Mackenzie Smith

Full Article

Why Searches Can’t Be Removed From Your Credit Report

The Searches section of your Credit Report shows you who has accessed the information on your Credit Report within the last couple of years. This effectively acts as a log of when you’ve checked your own Report, as well as a record of lenders checking as a result of applications for credit in your name. You’re also likely to see searches relating to prospective employers, landlords, insurance companies and other identity checks.

Published on 2 Jan 2019 by Beth Jennings

Full Article

How To Take Out Credit When Overseas In The Armed Forces

It’s no secret that the number of the UK’s active military personnel is set to decline further between now and 2020, but of the 145,000 UK Regular Forces across the Army, Navy and Air Force in 2018, as many as 18,500 served overseas during that time. With the recent news that the Army will accept recruits from commonwealth countries as well, a further portion of our armed forces is likely to be based overseas in the coming years.

Published on 27 Dec 2018 by Jamie Mackenzie Smith

Full Article

Why Your Credit Report is Like A Financial Dating App

We’ve spoken in the past about the link between a higher credit score and your romantic prospects, but the two topics might be even closer together than you think. That’s thanks to an emerging trend of dating apps that put a greater emphasis on your dating history in order to help potential future dates better assess whether you’re what they are looking for.

Published on 5 Dec 2018 by Jamie Mackenzie Smith

Full Article
keyboard_arrow_left

keyboard_arrow_right

We are rated number 1 for customer service on