Rebuilding your credit score
If you’ve been rejected for credit cards, contracts, or other financial products, it could be because you have a poor credit rating. The first thing to do is to find out whether there are any errors and see what you can do to improve this rating, and to do this, you need to start by doing a free credit check with the three main credit reference agencies Experian, Equifax and Callcredit.
Each of these companies has, by law, to give you access to your statutory credit file, and it will cost you just £2 and can be done online. With Equifax and Callcredit it’s instant to get the information, while with Experian it takes around 4 days to be sent to you. The statutory report contains your personal details, any links to other people you have through finances (i.e. if you have a joint mortgage with someone), whether you are on the electoral roll, any credit accounts you have and whether you’ve had any missed payments or defaults, and details of any searches that have been done recently on your file – for example if you’ve just applied for a credit card and been turned down, this would be on there.
Once you have established that there are no errors causing your low credit rating, it’s time to start trying to give it a boost. One way to do this, is with the cashplus creditbuilder card. Now this card is a bit of an odd one, as it works in a very similar way to all the pre-paid cards which are out there at the moment meaning there are no credit checks made when you apply for one. There is however one crucial factor with this card that makes all the difference. When you open it, you agree to pay £4.95 per month as your fee for having the card, and, the £59.40 that you’re agreeing to pay over 12 months, is technically a loan! So, the information about this part of the card, is passed to Experian meaning that as long as you pay the fee every month for the whole year, at the end of it, your statutory credit file will show that you successfully paid back a loan, and hopefully this will increase your credit standing.
It is however important to remember that if you miss a payment, or if one is late for any reason whatsoever, you could find yourself at the end of the year with a worse credit rating than you had to begin with, so only go down this route if you can be certain that you will be able to make the payments each month.