Firstly, you very much should bother. Number one, it’s free so you have nothing to lose, number two, one of the biggest reasons we see people either being declined for finance, or being offered a higher rate of interest for finance, is small items of adverse credit the applicant is unaware of, or active information at multiple simultaneous addresses.
There are two ways you can do this;
- The completely free way – which requires a small amount of effort.
- The almost free way – paying £2 and writing directly to the credit reference agencies
You can get details of how to do this over at our Free Credit Check page.
Whichever way you choose, here is why you should.
Your credit score is based on many things, and often when you are in the forces your credit file becomes a bit scattered due to barracks addresses and places you have moved to with work. Two things happen here. Firstly, if you don’t tell your phone or other crediting company you have moved, and you keep paying, they don’t know you have moved and will register information for you at an address you are not at. This can make it look like you have many active addresses that you live at. It would not be unusual for this alone to reduce your credit score, and equally may affect your ability to get credit, or affect your perceived risk as a customer and subsequently the interest rate you pay or are offered.
Secondly. If you owe a company £10,000, they will normally try to find you for sure. But if you change bank or mobile supplier, and have an outstanding bill of £20, in many cases, they won’t try too hard to find you as it isn’t worth it. This is the real problem because the lender will mark your account as being in arrears, and not really make too much effort to find you most of the time, but they will record the fact that you have an unpaid bill at a previous address. Eventually, when the payment is around 6 months overdue, they will mark your credit file as having a default on the agreement. This is called adverse information. Many applicants we see have adverse information that they have forgotten about, or don’t know about, and it really does make a difference to whether you are approved or declined in many cases.
So what should you do?
Firstly you should apply for your credit file as mentioned above, but it is very important indeed to mention every address you have been at, including barracks addresses, to make sure you capture every bit of credit information registered to you. Then you should try to identify every piece of information and which provider is submitting it, call the company that is listing the information, and advise them of your current address and get the information moved (please see our previous post about the voters roll for guidance on which address to give). Then, if you have outstanding and overdue debt, if you can, pay it, if you can’t immediately, call the company concerned and agree a payment plan to reduce and eventually clear the debt, but change your address to your current address at the same time.
The result of this is when you apply for credit in the future, all your credit information is at your current address, is paid, or being paid off, and there are no linked addresses with information registered at them. This will make a significant positive difference to your credit score once complete, and therefore increase your chances of being approved, and increase your chances of being offered a better interest rate.