A credit check is a search done by a potential loan provider to evaluate your eligibility for a loan. Loan providers will check out your credit report to know your ongoing and past credit history. Loan providers can then award you a credit score to identify whether the fashion in which you manage you financial matters meets their criteria for borrowing. A credit record is really a documented history of whatever credit that you have taken out within the last six years. It reveals the amounts you have accessed and if you have defaulted on any payments etc. A credit record allows potential loan companies to see your credit history to enable them to make a decision as to whether to lend you money.
The statistics on your report is complied by credit reference agencies such as Equifax and Experian. They utilise facts and figures from public records (e.g. electoral roll statistics, legal judgments etc) and from loan companies as well as financial institutions: e.g.
credit applications, credit accounts. A credit score or credit rating is an approach that prospective lenders use for figuring out the credit eligibility of a borrower. Loan providers will research the would-be client's credit report, the information within their credit application and the specific loan requested.
Loan providers will then use a numerical scoring system to assess the degree of 'risk' attached to lending to the applicant. A credit reference agency holds details of your personal credit information, such as credit cards, loans, etc including details of any defaults in payments, county court judgments (CCJs) etc. Details of defaults and CCJs are kept on your file for six years and can affect you getting further credit. These agencies - the major companies being Experian, Equifax and Callcredit plc - provide this information so that a lender can decide whether or not they will lend you money.
When applying for credit, you will be asked by the lender for your consent to check your credit file. This allows them to see a number of things - such as you are who you say you are; confirmation of where you live (your file should show you listed on the electoral roll); how much your current commitments are; how reliable you are at making payments on time etc. Having looked at this information, the lender will then make a decision as to whether they will lend you money. If you are refused credit, it is not because you are on a 'blacklist', it will be down to you not meeting the lender's criteria. The criteria - which varies from lender to lender - is based on your financial profile being 'Credit scored' and apart from your credit history, a lender will take in to account your occupation, your age, whether you are a homeowner etc.
If you are considering getting credit, it is worth contacting one of the credit reference agencies to see a copy of your report. You can then check that all the information on it is correct such as you being on the electoral roll, for example. The cost to see your file will be upwards of �2.
Contact Experian, Equifax or Callcredit plc for more information. Experian is a important UK credit reference agencies. Loan companies will turn to a credit reference agency to consider the suitability of a customer as determined by their credit history. This is considered a credit file. As with every consumer, you could get a copy of your credit report from Experian so as to confirm that all the information on it is correct and that your details aren't being used in a fraudulent manner.
Equifax is a important UK credit reference agencies. Equifax compiles all your credit information from different places to form a file that details your personal financial history - i.e.
your credit report. If you make an application for credit, lenders will look at your file to see your financial past. You could get a duplicate of your report anytime you like so as to confirm that everything is right.
The Equifax online website has a lot of constructive instructions on making proper financial choices and guarding yourself from fraudulent practices.
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