Martin Lewis shares 10 ways to boost your credit rating before Christmas
Martin Lewis has shared essential tips for anyone keen to improve their credit worthiness before Christmas, especially if they are looking to take out a loan or apply for a mortgage in the new year. The consumer champion examined that there is no definitive ‘credit score’ in the UK, but Experian, Equifax and TransUnion are the three firms which provide access to your credit report.
During this week’s Martin Lewis Money Show Live on ITV, the financial guru urged people to check their credit report - which can be done for free - at least once each year to make sure the information held on file is correct and there are no anomalies which could be impacting your chances of getting approved for credit cards, loans and even an overdraft. He also shared 10 ways to boost your ‘credit score’ and some can be done in just a few minutes.
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Martin told viewers that consistent answers are needed on every application. This includes your job title and mobile number. He explained there are two reasons for this, the first is that “lenders like evidence of stability” and if your answers are inconsistent they can trigger “fraud scoring”.
He also urged everyone to use an eligibility checker before making an application as this will only be counted as a soft search on your credit file, while an actual application will appear as a hard search.
Martin explained: “Applications are hard searches, they go on your file and lenders can see them and it has a negative effect. Too many in a short space of time has a very negative effect so go to an eligibility calculator which will tell you which card you’re most likely to get and give you odds, it uses a soft search which goes on your credit file but lenders are not allowed to see it so it doesn’t affect the assessment of you.”
He went on to say that too many applications can result in more rejections because of the number of searches being done on your credit file.
He also stressed that using an eligibility checker and comparing who is most-likely to accept your application enables you to “hone in” on the one you’re most-likely to be accepted for.
Top 10 ways to boost your credit worthiness
Martin shared the top 10 ways to boost your credit rating. These include:
Using consistent answers on every application
Using an eligibility checker to shop around for the lender most likely to accept your application
Using an online app to track rent payments made on time - Canopy and Credit Ladder
Making sure you are on the electoral roll - especially if you have moved home
Never missing a repayment, including buy now, pay later purchases
Making sure any linked purchases are not affected by your partner’s, house/flat mates credit worthiness
Applying at the right time - if you are applying for a mortgage or another big loan, don’t utilise all your credit or go into an overdraft to make yourself more appealing to lenders
Don’t apply for little loans before a big one such as a mortgage to minimise searches on your credit file
Never withdraw cash on credit cards - it’s expensive and goes against your affordability checks
You can catch up with the Martin Lewis Money Show Live on the STV Player or ITVX.
In this week’s MoneySavingExpert (MSE.com) newsletter, Martin also does a deep dive into boosting your financial appeal - you can read it online here.
