What is a credit score

Each lender scores you differently when deciding whether to approve an application but the information they use is similar.

Lenders look at previous dealings you have had with the company, which gives them an idea of your financial behaviour. They also use information about you provided by companies known as ‘credit reference agencies’: Experian, Equifax and Callcredit.

What credit agencies know about you

Credit reference agencies sell financial information about us to lenders and other financial services. The credit reference agencies most lenders use are: Experian, Equifax and Callcredit.

These agencies have financial information on file about every prospective borrower in the UK. They pass on this information to lenders, which lenders then use when deciding to lend you money.

These credit reference agencies take their data from:

• Electoral roll

• Court records

• Records of lenders who've searched your file previously

• Fraud data

Accessing the file credit reference agencies keep on you is the first step to fixing your credit. You will see how the lenders see you and you can estimate how long it may take to repair your bad credit history.

For £2.00 you can see your file, simply choose the agency you wish to use, go to their website and fill out a short form. Equifax and Callcredit aim to provide you with the report instantly, while Experian can take up to 4 days.

The report you receive contains your personal details, information on your financial links to other people and whether you are on electoral roll. It also contains the credit accounts you have, any missed payments or defaults and a list of your applications for credit or loans.

Also in this section

• What is a credit score

• How to start repairing your credit rating

• More steps to improve your credit rating