A credit report is a detailed report of an individual’s credit history. Credit rating agencies collect information and create credit reports based on that information, and lenders use the reports along with other details to determine an applicants’ creditworthiness for a loan, mortgage or credit card. Lenders will generally use one of three credit reference agencies – Equifax, Experian or Callcredit. Here we review the various options for getting a free credit report and discuss what to do if your credit score is poor.
30 Day Free Trials
The main credit reference agencies all offer a free 30 day trial before their monthly charges kick in. Experian is the largest credit reference agency. The only way to see your Experian report for free is to sign up for its 30-day free trial via its “Credit Expert” service. They offer new customers a “free 30-day trial, then £14.99 per month” service, which gives online access to your credit report and score, plus email alerts when anything changes on your report. Its a comprehensive service but you can only do the free trial once and need to remember to cancel at the end of your 30 day trial to avoid the monthly charge. Cancellation is via a free phone number.
Equifax offer a 30-day free trial, then £14.95 a month. You get online access to both your credit report, and your Equifax credit score, as well as email alerts whenever there’s any changes to your report. Like Experian, you can only do the free trial once and need to remember to cancel at the end of your 30 day trial to avoid the monthly charge. Cancellation is via a free phone number.
Callcredit is the UK’s newest credit reference agency, but is not yet as widely used as the 2 agencies above. Their Checkmyfile service allows you to see both your CallCredit and Equifax reports in 1 place via a 30-day free trial (£9.99 per month after). It’s ideal for those who want a comprehensive, ongoing monitoring service.
Free For Life
Clearscore provides free Equifax credit scores and reports, updated once a month. It aims to give you your credit report free for life. The catch is they make their money by selling you financial services products like loans and credit cards. You can delete your account at any time via their website.
Callcredit provides free monthly reports through its Noddle service. Like Clearscore, the Noddle service will make money by offering you credit cards and loans you qualify for but you are not required to take up any of these offers to use the free report service. They will also try to get you to sign up for premium credit scoring services. You can cancel your membership at anytime by emailing them via the website.
Why Is Your Credit Score Poor?
High levels of debt contribute to a poor credit rating in that, if you already have a lot of credit to pay back, potential new lenders may doubt whether you can afford to take on more debt. Being issued a county court judgement (CCJ) for unpaid bills will have a severe impact on your credit rating.
Missing repayments on existing loans, abusing credit cards, and failing to pay off your mortgage as planned can also leave a dirty stain on your credit rating for up to six years. Even being connected to somebody else with a poor credit rating – such as through joint credit in bank accounts – can have an adverse impact on yours!
Short Term Fixes
Stop Further Damage – If you’ve applied for a loan or some other kind of credit and have been rejected, stop applying for further loans. This can be detrimental to your credit score! Instead, put it on hold until you’ve improved your credit score.
Cancel Cards – If you have existing credits cards which are not in use, cancel them with the lender and then destroy them. Not having access to these makes lenders feel more secure that you won’t suddenly rack up more debt, and it also means you’re much less likely to fall victim to fraud since your details can no longer be stolen and used on such latent cards.
Join The Electoral Register – Being on the electoral register positively impacts your credit score. If you’re not on it, you’ll find it harder to borrow money! You can register for this easily online.
Longer Term Fixes
Protect Yourself From Fraud
If someone opens up and a credit card in your name and racks up debt on it, the negativity attaches to your credit score. To protect yourself from such fraudulent activity, regularly check your credit score for anomalies. Be under no illusion that fraud happens: the sooner you spot it, the sooner you can wipe its damage from your credit rating. You are legally entitled to a copy of your credit report for £2, so do this with Experian, Equifax and Callcredit regularly to stay alert.
Focus on rebuilding
To nip further damage to your credit score in the bud, make a significant effort to keep on top of repayments for existing debt. Likewise, focus on rebuilding your credit rating using a credit-builder prepaid card. These work as a case study of your ability to pay off debt! You’ll be lent around £60, and will agree to pay this off over 12 months at £5 monthly repayments. At the end of this year – assuming you keep up with these small repayments – you’ll have a record of 12 months worth of successful repayments to strengthen your credit rating.