Each year in the UK millions of people apply for a loan, insurance, or a job. When applying for a loan, individuals allow lenders to pull a Credit Report. From there, lenders can assess an individuals risk of non-payment. Similar evaluations occur for certain types of insurance and employment opportunities. Lenders use the data from a credit report and the credit score to assess an individual’s creditworthiness. In most cases, lenders use this Credit Score while also using their own custom rankings.
The three main credit reference agencies in the UK are Equifax, Experian, and TransUnion. TransUnion is our partner and the leading credit bureau for the underserved population, which accounts for as much as 40% of the UK market. This allows us to provide the highest quality report for the population and the richest feedback for those who live in said 40%.
Why your Credit Score and Report Matter
Securing a Loan
Lenders like to see that you are low risk when it comes to repaying what you owe. If you have a poor credit history then it will be difficult to get a bank to lend you money at an attractive rate. In many cases involving poor credit, they may decide not to lend any money at all.
Even if you are able to meet a loan with a poor credit score it is likely that the loan will be a “bad credit loan”. Bad credit loans are small loans with high interests rates.
For this reason, it is important to build your credit. By doing so you can prove to lenders that you are reliable when it comes to making your repayments.
Employment
What you may not know is that some employers now require a credit report as part of the recruitment process, particularly if you are looking to work in the financial sector. They may use it to make decisions on your fitness to be employed in that position and whether you are worth employing at all. They may even use it to make decisions on whether you are worth employing. If an employer views your potential debt as too high it may affect the salary they are willing to offer.
Insurance Rates
Your credit score is likely to play into your premium. Insurers have created a score somewhat like the credit score called an insurance score. They use this score the way lenders use your credit score and create prices that they feel fit you.
So be aware that a poor credit score can cost you hundreds of extra pounds in premiums each year.
Mobile Phone Contracts
As the competition between mobile carriers has grown, so have their tactics for targeting customers. Customers with better credit scores are receiving better pricing options. However, keep in mind that carriers target customers with lower scores as well.
Those with good credit are eligible for financial plans they are comfortable with. While those with poor credit may not be eligible for financing plans at all. The plans the carriers offer may include higher upfront deposits and monthly payments.
What You Can Do
Our Credit Report feature provides you with a Credit Report and Score from TransUnion. It gives you the ability to see reasons for changes in your score and alerts to any new information in your report. You can also watch for fraudulent activity and errors in your reports composition. This same access allows you to see your score trend over time and learn about the reasons for any changes.
We also provide you with tips on how to improve your score so you can graduate to less expensive loan options. Our blogs provide insight into challenges faced when applying for a loan, insurance or job.
When combined with our Loan Affordability Assessment and Dark Web Scan our tools empower you to manage your finances while protecting the security of your financial data.
Tap Into the Digital You at ScoresMatter and secure your financial future today.