We explain why your credit score might be low and give you 10 simple steps to help you improve it.
A higher credit score could help boost your chances of being approved for the best financial products (e.g. mortgages, credit cards and loans). So it's always worth trying to work on your credit score and make it the best it can be.
If you're wondering why your credit score is low, here's a quick video to explain some of the reasons for this:
If you want to get on with improving your score, here are 10 simple steps you can follow to boost your credit score:
1. Keep your credit utilisation low
For a better credit score, try not to use too much of your available credit. Keeping your credit card utilisation low, preferably under 50%, shows lenders that you can manage your credit sensibly. You can see how much of your credit you’ve used by logging in to your ClearScore account.
2. Get organised
Forgetting to pay bills can damage your credit score. Setting up direct debits to pay your utility bills, phone and credit card payments means you can relax, and your credit score will be all the better for it.
3. Fix mistakes on your report
If you have any mistakes on your credit report (such as a typo in your name or a wrong address) then it can affect your credit score. For example, if your name is wrong on your credit report, some of your credit accounts may not be correctly matched with your report. This means your credit score won’t benefit from any positive behaviours associated with these accounts.
By checking your credit report, you can spot (and fix) any mistakes. To do this, visit the help section of our website, and tell Equifax what’s wrong by raising a query. You can read more information on our FAQ.
4. Get on the electoral roll
Getting on the Electoral Roll (also known as the electoral register) is one of the easiest ways of boosting your credit score. Getting yourself on the register helps credit reference agencies verify who you are, and makes you appear more stable to lenders. You can register here. If you’re not sure if you’re registered, you’ll need to check with your local authority which you can do here.
5. Look out for fraud
By regularly monitoring your credit report, you can check for signs of financial fraud. If you have been a victim of identity theft, there will be evidence of it on your report, such as new credit accounts you didn’t set up or searches on your report you don’t recognise. You should report any fraudulent activity to Action Fraud.
6. Remove false connections
Bad financial connections can affect your credit score. If there’s an incorrect or out-of-date financial connection on your report, such as a joint account that has now been closed, get this changed by raising an enquiry with Equifax.
7. Actively monitor your score
Lenders share all sorts of information about you with credit reference agencies, who store this data so it can be used to assess your credit risk. ClearScore partners with Equifax, which is one of three major credit reference agencies in the UK. The other two are called CallCredit and Experian. It’s worth checking in with all three companies to get a good overall view of your finances. CallCredit’s data can be accessed with a free service called Noddle, and Experian’s data can be accessed with a free trial (but remember to cancel your subscription before the free trial ends).
8. Plan ahead when you need credit
Credit applications result in hard searches on your credit report, and too many could negatively impact your score. By planning in advance, you get your credit report in shape before making an important credit application. This will improve your chances of being accepted, which will help keep your credit score intact.
9. Use an eligibility checker
Being rejected for credit could lower your credit score. Using an eligibility checker enables you to check the likelihood of acceptance before you apply for credit. ClearScore’s ‘Offers’ section shows you financial products selected as the most relevant for you, alongside your eligibility percentage (e.g. 90%). Many credit card providers also offer eligibility checks, which use a soft search to check your likelihood of acceptance. You’re the only one who can see your soft searches, and they don’t affect your score.
10. Build your score – use a credit card little and often
Using credit responsibly is a key element to building your score. Keeping your credit card active, by spending small amounts and paying them off each month, makes you appear more attractive to lenders. This is because it shows you can reliably pay back the money you borrow.