7 min read

How does your address affect your credit score?

Hannah Salih
15 May 2018

Your address can have an impact on your credit score, but not in the way you might think.

Your address is an important part of making sure that all the information in your report is accurate and up to date.

But there are lots of myths around how your address affects your credit score - does where you live affect your score? Is there such a thing as an address blacklist? What does moving house do?

We’ve taken a look at how your address is really used by credit reference agencies to give you an accurate view.

Credit reference agencies use your address to help put together your report

The UK doesn’t have a national identity card system. So, the three credit reference agencies (CRAs) - Equifax, Experian and Callcredit - compile your credit report using your personal information such as your name, date of birth and (to a lesser extent) your address.

Your address is one of the few common denominators across all your credit accounts. This is because you usually need to have a permanent address in order to get credit. This goes on all your credit applications and into your lenders’ files, and it forms part of the data they share with credit reference agencies.

Credit reference agencies use it for two key purposes:

  1. to confirm your identity
  2. to match all your credit information to you

There is no such thing as an address blacklist

We bet you’ve heard this before – that there’s an address ‘blacklist’ and that moving somewhere on the list will automatically bring down your credit score. But luckily, this isn’t true.

Credit reference agencies use your address more as a way to confirm your identity than to calculate your credit score.

Your credit score is mostly based on how you have handled credit in the past. This means things like your area, or who lived at your address before you, shouldn't have an impact your score.

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But moving all the time could indirectly affect your ability to get credit

Lenders tend to like stability in people’s credit reports. Moving several times within a short period may indicate a number of issues to lenders; they may think that you have a challenge around paying your rent, for instance. This may influence their decision to give you credit. Most of us can’t avoid moving when we have to so don’t worry too much, but it’s good to be aware of the possible impact.

Issues with your address can cause mistakes on your report

Credit reference agencies use your address to help match you to your credit information. So, if your address is outdated or incorrect, it could lead to incomplete or inaccurate information appearing on your credit report. This can affect your score.

To help make sure all the information on your report is correct it’s important that all your active credit accounts are registered under the same address. It’s really easy to change your address – it usually just involves giving your lender or bank a call, or logging into their app or online banking site to update your details.

Don’t let the stress of moving house affect your credit score either

All the stresses of moving home make it easy to inadvertently harm your credit score. To help prevent that:

  • Use direct debit as much as possible

    As well-organised and careful as you might be, it’s easy to misplace stuff when you’re moving, including bills. You can make sure you don’t miss any payments by setting up direct debits. Payment will be taken automatically from your bank account, even if you forget it’s due.

  • Tell your bank and other credit providers you’re moving

    The procedure for this will vary. Some will let you change your address online, while others may ask you to go to the nearest branch to confirm your identity. You can use this handy checklist to make sure you don’t forget anyone.

    It’s important to always write your address in the same format. For example, don’t write 44 / 2 on some applications and 44 Flat 2 on others. Even something as simple as a misplaced number could lead to issues such as a split report.

  • Redirect your mail

    While this costs money, it’s worth doing just in case - you never know who might slip your mind in the bustle of the move. It also ensures your mail doesn’t fall into the wrong hands, which could lead to identity theft or fraud.

    To redirect your mail, log on to the Post Office website and enter your details. You can redirect your mail for three, six or 12 months.

  • Get on the electoral roll

    Once you’re all settled in your new home, it’s good to register to vote. This will give you some much-needed stability at your new address. It also makes it easier for credit reference agencies to verify you.

  • Check your credit report

    You don’t need to notify credit reference agencies about your move. Your credit report should be updated automatically.

    However, it’s a good idea to check that your new details are correct just in case. That way, you can fix any issues as soon as possible. You can do this step simply by logging straight into your ClearScore.

In a nutshell:
  • Credit reference agencies use your address to verify your identity and match you to your credit information.

  • Your address doesn’t affect your credit score. However, it affects what information appears on your report, which can affect your score. Moving house too often can also make you look less stable, which might discourage some lenders from giving you credit.

  • If you have to move house, remember to notify your lenders of your new address. It’s also a good idea to redirect your mail. Always use the same address in the same format, as even slight differences can lead to issues.

  • Credit reference agencies update your address automatically. However, it’s a good idea to check your report to make sure it’s listed correctly.

by Hannah Salih

Hannah reads all the finance info on the web so you don't have to. She knows all there is to know about your finances but still spends all her money on brunch. 

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