Improve your credit score for a mortgage: All you need to know

If you’re getting ready to buy a new home, you may be looking at ways to improve your credit score for a mortgage. But how does your number impact your approval chances?

The first thing to know is that your score is a personal reference for you. It gives you an idea of your overall credit health and how likely you are to be given the green light for new credit, including a mortgage.

Lenders assess the information on your credit report, not your score. And they use their own internal scoring models that take things like your income and deposit size into account to give them an idea of how likely you’d be able to comfortably pay them back.

Understanding your credit score, and the things that influence it, is a great way to prepare for making an application.  

Why your credit score matters for a mortgage

Your credit score provides a handy snapshot for how you could be perceived by lenders. But you can get a full understanding of what lenders see by checking your most detailed credit report.

 At Checkmyfile, we provide the only report that puts all your information from the UK’s three main credit reference agencies – Experian, Equifax, and TransUnion – in one place. Start with a 7-day free trial. It's then £14.99 a month and you can cancel online anytime.

It's also worth noting that, as well as your credit history and the information that's on your file, mortgage lenders will also take your income and its stability into account. 

Lenders will look at the value of the property you're trying to buy to see whether you match their lending criteria and can afford to borrow before giving you an offer.

How to improve your credit score for a mortgage

Growing your credit score usually takes time. But the steps you take now can be worth it in the long run.

To help improve your credit score, you can:

• Check your credit report for any errors or financial associations who may no longer be relevant. If you see something that doesn’t look right, our UK-based customer care team can help.

• Register on the Electoral Roll. Even if you don’t intend to vote, lenders use the Electoral Roll to verify your details. 

• Monitor your credit utilisation.

• If you have credit commitments, make sure you make every payment on time. Consider setting up Direct Debits if you haven’t already. 

• Only apply for new credit if it is right for your financial situation. Making multiple applications in a short space of time can lower your credit score. This is because lenders can see that you’ve applied but not the outcome, so may think you’ve taken on a lot of credit at once and may struggle to pay them back.

Learn more ways to improve your credit score in our article. 

How long does it take to improve your credit score before a mortgage?

There's no set length of time that it takes to improve anything that’s negatively impacting your credit score.

If you have a County Court Judgement or IVA, which stays on your file for six years, the initial impact of that is substantial, but your score recovers gradually over time. 

And it's the same for missed payments. The initial impact is high, but as long as you don't make additional missed payments, your score will slowly improve.

Electoral Roll information can take anywhere from one to three months to update. You can monitor any updates with your credit report. 

Having a low credit score isn't the end of the road. No matter what your number is now, there are habits you can build to get things moving in the right direction over time. Take the first step on your journey to better credit health today.