Your Credit Rating Matters
We all want to get the latest, hot car or the fabulous, once-in-a-lifetime holiday that our hearts truly desire but very few of us are fortunate enough to always have the cash for such expensive treats immediately to hand. We’re far more likely to use a credit card for the purchase and pay that off at our convenience or we may take out a one-off loan for the transaction.
But whichever way you look at it, most of us rely on credit to fund all of our largest purchases, including our homes. The ease with which we can get the credit we need – and the rates we have to pay for the credit we take – effectively influence the quality of our lives and our ability to do the things that really matter to each of us. That’s why your credit rating matters. We each have a personal credit rating and it is this rating that in large part determines our ability to get good credit at the most competitive rates.
Your credit rating may be displayed as a three-figure number or as a star-rating but we all have one and lenders will check it before agreeing to any finance deal or new credit card. Your credit rating is derived from your credit report, which is produced by one of the UK’s leading credit reference agencies.
Your credit report includes many items but always shows your:
* Name and address information
* Bank accounts, credit cards, store cards and direct debits
* Up-to-date payments record on bills and loans
It is little exaggeration to say that your credit report is one of the most important documents about you – it can have a major effect on your quality of life. Reviewing your credit report regularly will help you understand the factors that support your credit rating.
Your credit report can also help as a personal financial management tool by enabling you to see if attempts have been made to steal your identity with, for example, applications for loans, credit cards or financial accounts that you know nothing of. Understanding your credit report will help you to understand your credit rating – and that’s the key to successful borrowing on the best terms.