5 min read

How to use credit to get yourself a great credit score

Hannah Salih
2 August 2018

Using credit responsibly and checking your report regularly could help give your score the boost it needs for the future

A good credit score is a really useful financial tool to have in your kit. A higher credit score can help boost your chances of being approved for the best financial products at the best interest rates.

You may not need or want credit now, and there’s nothing wrong with that. But you never know what the future may hold. If you’d like to own your own house one day, you’re going to need a pretty solid financial history to get approved for that mortgage. Or you might want to get a credit card to take advantage of some of the benefits, or to spread the cost of a big purchase you need to make.

It's always worth trying to work on your credit score and make it the best it can be. Future you will thank you. Follow these top tips and you can rest easy in the knowledge that your building a stellar score that will be there for you if and when you need it in the future.

1. Use credit little and often

Using credit regularly and responsibly is a key element to building your score. Keeping your credit card active, by spending small amounts and paying your bill off each month, makes you appear more attractive to lenders and can help boost your score. This is because it shows you can reliably pay back any money you borrow.

Credit builder cards are designed specifically for people with little credit history. They usually have very high interest rates (typically 30% or more), and rarely have any perks.

However, they’re a powerful way to improve your credit score. And if you handle them responsibly, your provider will increase your credit limit and decrease your interest rate over time.

2. If you do decide to take out credit, use an eligibility checker before you apply

Every time you make an application for credit, a 'hard search' is carried out on your account and a mark is left on your credit report and this can affect your score.

ClearScore’s eligibility checker lets you find out your chances of being accepted without affecting your credit report and score.

If you do happen to be rejected for credit, try to resist the temptation to apply multiple times. Instead, wait until some time has passed before you apply again.

3. 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 30% of your limit, 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.

4. Pay your bills on time and in full

Forgetting to pay bills can damage your credit score as it suggests to lenders that you struggle to manage your credit well.

To avoid this, you can set up direct debits to pay your utility bills, phone and credit card payments. This means you can relax, and your credit score will be all the better for it.

You can pay just part of your balance, the ‘minimum payment’, without damaging your credit score. However, the remainder will attract interest. Credit builder cards have high interest rates. So, if you’re not careful, your debt can quickly spiral out of control.

5. Get on the electoral roll

Getting on the electoral roll (also known as the electoral register) can help improve the way you're viewed by lenders, and boost your chances of getting accepted for credit. This is because credit reference agencies are able to verify who you are, which can make you appear more stable to lenders. You can register for the electoral roll here. If you’re not sure if you’re registered, you’ll need to check with your local authority which you can do here.

6. Fix mistakes on your report

No matter what your score is now, checking your credit report regularly is one of the best ways to keep on top of your finances.

If the information in your report isn't accurate (e.g. an account appearing as 'open' when it is 'closed') then your credit score won't be either. Checking your credit report regularly, you can spot (and fix) any mistakes, which can help boost your credit score.

ClearScore gets your credit report from Equifax, the credit reference agency. So if you find any mistakes on your credit report, you'll need to talk to Equifax directly (which you can do here. You can read more information about this on our FAQ.)

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. 

ClearScore exists to make your finances simple.
We offer a free service where you can handle everything to do with credit in one place. In your ClearScore account, you can see your credit score and the full details of your credit report. Your credit cards, mortgages, mobile phone contracts, loans, overdrafts and utilities all on the record. Our goal is to make ClearScore as simple, calm and straightforward as possible. Money is stressful enough.