The Dos And Donts For A Good Credit Rating
In the UK, millions of people continuously used credit cards for things they both need and want but that all significantly changed in the advent of the present economic slump. A lot of these people were also randomly offered credit cards by numerous banks even though their finances weren’t thoroughly checked. This has made credit card customers complacent and passive about their credit card handling.
Now that a lot of banks and lenders have been sternly affected by the recent recession, they have enforced tighter rules on how they grant loans and credit to consumers. The outcome — fewer people are able to have access to really needed secured and unsecured loans such as mortgage, car loans, personal loans, and at times, credit cards.
If you hope to get hold of a loan without any hassles, you should be alert with your records, receipts and documents that has something to do with your loans.
Keeping track of your credit record is the first key factor whether lenders decide to grant you the loan you need. Your credit record will be the measuring stick lenders will look at.
Your credit report is sort of an almanac of everything you loaned, how much, from which lender, your payment practice and so forth, so you need to check it methodically and make certain that everything in it are as it should be, concise and updated.
The crucial details you need to be alert of are the balances that you have already paid but are still indicated as unsettled. A slip-up such as this should be cleared up right away as it will not only cost you more on your payment, it will also reflect unfavorably to your credit rating.
Other lesser typographical or factual errors such as your name, address, telephone number, or anything else that is contradictory, should also be addressed with your bank/lender.
If you are moving residence, make sure you cancel your contract or change the information with your electric, water, and other utility bills. This is to ensure that the next dwellers (if any) will not be able to charge these utility costs on your name. You should also redirect your parcels and mails to your new address to prevent interception of your mails by other people that could use them for fraudulent purposes.
If you have a joint credit account with a significant other (e.g. girlfriend/boyfriend, spouse, etc.) be sure to cancel the account if the two of you are to split. If you are always on time with your payments and your partner isn’t, your credit record could get affected by it. This is what is known as a financial association.
Should you ever get to this point, you should cancel your joint account and set up your own personal account. Should there still be a debt on the joint account, you or your partner should shoulder that debt. The debt should be integrated to your individual account or your ex-partner’s account.
Lastly, erase the financial association from your credit report by telling a respectable credit reference agency.
If you have never taken out a loan, and you have been working for years, you could have a hard time borrowing from a lot of lenders.
This is because you don’t have a track record to prove to lenders that you are a borrower they can trust. If you want to start a reliable credit rating, you can start by applying for a credit-building card and use it to pay for things that is within your means and not be delayed on your payments, and maintain this account for at least 12 months.