Five things you can do to improve your credit rating

There’s been a lot of fuss over credit ratings or credit scores in the past few years. This is largely due to the massive media coverage of payday loans. The press has generally portrayed these loans in a bad light and in so doing has left many people feeling wary about their credit score.

Your credit rating isn’t the be all and end all in terms of getting a loan, but it does play a huge roll. But, thankfully, you can take control of your credit rating and turn a negative score into a positive one.

Here are five things you can do to improve your credit rating.

Stay updated

Credit ratings fluctuate over time and so it’s a good idea to stay on top of your credit score at all times. This allows you to make changes before you really start to get into problems. Credit Expert offers free credit report and score information online. This free scheme allows you to monitor any changes to your credit score and part of this free credit report and score scheme is a text and email alert system that instantly informs you of changes to your credit score. Seeing as this is a free credit report and score package, you’d be stupid not to utilise it.

Check your personal details

Aside from your financial history, your credit report uses information from the electoral roll such as where you live. If you have moved you need to make sure this information is updated on the electoral roll. Also if you’ve ever lived with anyone that had a poor credit report this could affect your own credit rating if you fail to update the electoral roll.

Use credit cards

This is not something you should do if your credit rating is already poor, but if you don’t have a credit history and you are a first-time buyer trying to get a mortgage, take out a credit card six months prior to seeking a mortgage. You must pay back the balance in full every month to avoid paying interest, but this shows the bank and credit checking companies that you can effectively deal with credit.

Image David Castillo Dominici


If you can it is sometimes worth consolidating all your loans into one. If you have store cards for instance, that charge a very high interest rate, you could take out a loan with a lower interest rate to clear the store cards so that you get the interest payments under control. You can then pay the loan back in a more manageable manner. However, if you have a very poor credit rating this won’t be possible as you’re unlikely to get a new loan, but you could investigate remortgaging and using your house as collateral. But this should be a last resort.

Include further information

Anyone can get into financial difficulty if circumstances allow it. A divorce or redundancy can affect your ability to pay as can ID theft. You can add a note to your credit history alerting credit checking companies to this and give evidence that you have since changed and can now pay back credit without a problem.

This article from The Independent offers further insight.