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How to improve your credit score

We explain why your credit score might not be as high as you'd like it to be, and give you 10 simple steps to help you improve it.

29 September 2019Hannah Salih 5 min read
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A higher credit score could help your chances of being approved for mortgages, credit cards and loans at the best interest rates. Making sure you credit score is the best it could help you save money.

Your credit score is a number that represents your credit history – it gives you an idea of how lenders see your past relationship with credit. The higher your score, the surer lenders feel that you’ll repay what they lend you.

Credit reference agencies use your credit history to work out your credit score. The UK has three credit reference agencies (Experian, Equifax and TransUnion) that score you.

They build your credit reports using information about you, your UK bank accounts and payment history. Each uses roughly the same formula, meaning they are all looking for the same signals that you are worthy of credit.

So, how do you boost your credit score quickly, signalling to these agencies that you are in fact trustworthy?

There are a few things right off the top that can improve your credit score:

You can grow your score by using credit regularly and responsibly. Spending small amounts and paying your bill off each month shows lenders they can trust you to repay what you borrow.

For a better credit score, try not to use too much of your available credit. Only using a percentage of your credit limit – preferably 30% – 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.

Your credit score is based on the information in your credit report. If this information isn't accurate (e.g. an account appears as ‘open' when it is 'closed'), then your credit score won't be either. This could mean your score is lower than it should be. By checking your credit report regularly, you can spot and fix any mistakes, which can help improve 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. Read more about this in our credit reports & scores FAQs.

Getting on the electoral roll or electoral register lets credit reference agencies check your identity, which can make you look more reliable to lenders. Register for the electoral roll or, if you’re not sure if you’re registered, you can check with your local authority.

If you aren’t already on the electoral register, do it now. The reason is that banks use the registry to verify who you are, including your name and other basic information. If you are not already registered, your score will suffer and this may have a negative impact on credit applications.

Every time you make an application for credit, a 'hard search' is carried out on your account, which affects your credit score. If you make too many credit applications in a short space of time, this makes lenders think you're desperate for credit.

So if you're rejected for credit, try to resist the temptation to keep applying. Instead, wait a while before you apply again. While you wait, check your credit report to make sure everything on there is right.

Avoid getting rejected for credit by using an eligibility check or a 'soft search' before you apply. This means lenders can see some information about your credit history, but the check won't affect your credit score. Only you can see if a soft search has been carried out on your account.

We’ll tell you on your ‘Offers’ page if you’re pre-approved for a credit card or loan. This makes you feel sure of getting a ‘yes’ when you apply for credit.

Utility bills – such as your mobile phone contract or your gas bill ¬– count as a form of credit. If you pay them on time, they're a great way to show lenders you can pay your bills back reliably.

You may be paying your share of the bills every month, but if a flatmate is directly paying the bills your contribution will not be reflected in a credit check.

If you don't have an account in your name, it might be worth considering putting one or two utility bills in your name. Otherwise, if you’re paying in full and on time, someone will literally be taking the credit for you.

You can improve your credit score by paying your bills on time. Stay on top of your bills by setting up Direct Debits. This shows lenders that you can stay on top of your credit, and your credit score will be all the better for it.

The more bills you regularly pay in full in your name, the better. Credit agencies will see this when they run their report. So ask to transfer utility and gas bills under your name, or add your name if possible.

Since the pandemic, identity fraud is on the rise. If you fall victim, this could damage your credit score, as you become responsible for the credit actions of someone else.

Checking your credit report regularly will help you spot financial fraud quickly. If anyone’s trying to open credit in your name, you'll be able to see the early signs in the searches section of your report. This section lists all of the 'hard' credit searches carried out in your name. If there are any hard searches you don't recognise, it could be fraud (though it's always worth double checking with the named lender). You should report any fraudulent activity to Action Fraud.

ClearScore Protect helps to protect you from identity fraud by scanning the dark web for passwords associated with your email address – it’s free, forever. Learn more about how Protect helps keep your online identity safe.

Your credit score is calculated by a credit reference agency (CRA). There are three CRAs in the UK – Experian, Equifax and TransUnion (formerly Callcredit).

Each CRA may hold slightly different information about you, which means that you’ll have three different credit scores.

It’s worth checking in with all three companies to get a good overall view of your finances.

When you move to the UK your credit scores abroad do not come with you. You’ll be starting from scratch and, if you play it smart, there’s nowhere to go but up.

Similarly, if you’re just breaking into the adult world of finance and have never had your name associated with an account, or simply trying to rebuild from a bad place, get ready to make a good impression.

One of the best things to do is secure a credit card and establish yourself. But use it responsibly: make purchases with it but don’t go over your credit limit. Pay it off on time and in full, and don’t spend to your limit.

Chances are, if you have no or poor credit history your first card may have low credit limit and higher interest rates. It will have a low credit limit and high penalties. Some lenders specialise in offering credit cards for bad credit.

But if you follow these steps, before you know it your credit score will 1) exist and 2) be on the rise. And as your score improves, options for better credit cards and financial perks (like mortgages and rental options) may open up too.

Key highlights

  1. Use a credit card little and often
  2. Keep your credit utilisation low
  3. Fix mistakes on your report
  4. Get on the electoral roll
  5. Avoid making multiple credit applications in a short space of time
  6. Use an eligibility checker
  7. Get your name on some bills if it isn’t already
  8. Pay your bills on time
  9. Look out for fraud
  10. Make sure you have a good overall view of your finances

Hannah Salih Image

Written by Hannah Salih

Content Creator

Hannah is currently studying for a Master's in Comparative Cultural Analysis. She knows all about personal finance, but as a student, she's an expert in money saving tips and tricks.