Credit scores are used by prospective lenders to help them understand how financially reliable you are. A good credit score can help improve your chances of being approved for funds. So, it’s important to know how to check your credit score, improve it, and keep track of it. Find out how to check your credit rating in this guide.
How to check a credit score
It’s free and easy to check your credit score. There are three different credit agencies you can use, and all three offer insights into your credit reports. These are Experian, Equifax and TransUnion.
Experian
Experian is the largest of the three options and offers a very comprehensive service – so much so that it’s often used by lenders. With Experian, you have a few different options when checking your credit score:
- Sign up to a free 30-day trial, which changes to a £14.99 a month service, of their Experian CreditExpert*. You can check your credit report in real time and use an eligibility checker.
- Sign up to see your Experian credit score for free. As it’s free, the information is limited to your score, and you won’t be able to access your full report. Your score updates every 30 days.
- Access your statutory credit report. This is a legally entitled, free, basic credit report. It’s easy and fast to obtain, but not as thorough as a full report and it doesn’t contain your credit score.
Equifax
Equifax also allows you to check your credit score and report. Here’s how you can do it:
- Sign up for Clearscore*, for free access to your monthly Equifax Credit Report. It offers an eligibility checker and allows you to see your credit score and reports. It’s updated monthly.
- Equifax Credit Report and Score provides access to your real-time credit report and sends alerts each day if there are any changes to your account. You can enjoy a free 30-day trial, before you’re charged £14.95 a month.
- Equifax also offer a statutory credit report.
TransUnion
TransUnion is the newest credit agency of the three and isn’t used as widely. Here’s what it offers you when checking your credit score:
- You can access your credit score and report through Credit Karma for free. It also offers an eligibility checker. Your credit report updates each week. Apply online or via the app.
- Credit Monitor is an alternative to Credit Karma, and also allows free access to your TransUnion credit score and report. It updates your details each month.
- TransUnion also offers a statutory credit report.
While there is overlap across all three, it can be worth applying to them all. Certain lenders only check one, so understanding how your records look across the three could come in handy. Your personal checks aren’t recorded on the reports, so it won’t be held against you.
What’s the difference between credit ratings and credit scores
While both your credit rating and credit score give you an insight into the health of your credit, they provide different things to different people. In short:
- A credit score is shown as a three-digit number. It’s assigned to individuals and businesses and used by lenders to determine whether an applicant is a responsible borrower. Your credit score comes from the Fair Isaac Corporation (FICO). This takes the following data into account: payment history, current debt, types of credit used, longevity of credit history and new credit accounts. The score ranges from 300 to 850 – the higher the number the better the score.
- A credit rating is shown as a letter grade. It’s most commonly assigned to businesses, governments and is used by investors to rate their riskiness. The most popular ratings are produced by S&P Global. It uses AAA for corporations most likely to meet financial obligations, and then ratings: AA, A, BBB, BB, B, CCC, CC, C and D for default.
Why should I check my credit score?
They say it’s good to get into a habit of checking your credit report at least once each year. When you check your score, you’re able to get an idea of what potential lenders see when they’re assessing your loan or credit card application. It gives you a chance to rectify mistakes or update any old information.
Checking your credit score is important for a variety of reasons:
- Stay ahead of fraud – keeping an eye on your records can help you notice any suspicious activity. See if you spot anything unfamiliar – like a different address, new credit card account or activity that you don’t remember.
- Update information – as mentioned above, your credit score provides a good opportunity to fix any errors you may notice. If a lender has accidently reported that you made a late payment, now’s your chance to dispute it.
- Check payments are reported – when building credit, it’s even more important to make sure that any payments you’ve made on-time are reported.
- Improve your score – knowing what your score currently is can help incentivise you to improve it.
How do I improve my credit score?
A good credit score is important when it comes to borrowing money in the future. It may secure you a more favourable interest rate, better terms and better access to finance. It may even help you to skip a utility or rent deposit as companies may use your score to see if they need a deposit or a letter of guarantee.
Here are some common ways you may be able to improve your credit score:
- Fix and report errors – if you do notice any mistakes, report these to the credit reference agency as soon as possible. The mistake will then be called a ‘dispute’ on your records.
- Build up your credit history – if you can provide evidence that you can borrow responsibly, it may help to show you’re reliable. You could open and manage a current account – and stay within the overdraft limit.
- Check who you’re financially connected to – if you have a joint account with someone with a poor credit history, it could affect your credit score. If you close a joint account, you can request a ‘notice of disassociation’ to stop your files from being linked to theirs.
- Provide extra information – improve your score by registering to vote at your current address or add your rent payments to your credit report.
- Consider consolidating your debt – consolidating any current debt may help to make it more manageable, so you can pay it back faster and improve your credit score.
- Limit how many times you request new credit – applications for credit cards, loans, and mortgages can negatively affect your credit score.
Knowing how to check your credit score is important when considering applying for finance. Learn more on our Know How blog.
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