Your credit rating is an overview of your financial history, commonly used to help prospective lenders decide whether or not to offer you credit.
From getting a phone contact to getting a mortgage, a lot can be affected by your credit score. This means keeping it healthy – by paying your debts on time, avoiding overspending, and looking after your finances in other ways – is important. But what should you do if your credit score is poor through no fault of your own?
Finding mistakes
There are three main credit reporting agencies out there: Equifax, Experian and CallCredit, and if you haven’t checked to see what information, such as past lender agreements, they have recorded on your credit report then you can find out for just £2. A small price to pay for a detailed breakdown of your credit history, and in what stead it currently stands.
This will allow you to see if everything is accurate. A solid knowledge of your earlier credit history is vital, since you want to ensure that you’re not paying for things like phantom credit. While mistakes aren’t common, they do happen, so here are a few things to check:
• Incorrect personal details (including your national insurance number and an up to date address)
• Payments recorded as late which were actually made on time.
• Financial associations with people you no longer share joint credit with.
• A bill or payment listed under your name that does not actually belong to you.
Some of them might seem small, but absolutely all of these – as well as any other errors – have the potential to damage your credit rating, and affecting your future applications. Remember, when a mistake is made, you are well within your rights to have it changed.
Changing mistakes
Once you’ve located all of your mistakes, it’s time to set them right. All is most definitely not lost. First, you’ll want to make a list of each of the inaccuracies. Then, write a single letter for each credit error you’re disputing. It doesn’t matter if you’re writing to the same company, ensure one letter equals one disputed error.
These letters of dispute will typically be sent to the credit reporting agency, although in some circumstances you may find yourself writing to the initial lending organisation or current holder of the debt. In this scenario, it pays to collect as much documentation as possible. Request the details they hold on your account, including payment history, as well as evidence of the disputed credit in question.
Taking it further
Not getting those errors changed? While it’s unlikely that genuine credit errors will be left unresolved by those handling the records, if you have a genuine complaint about how a reporting agency is treating your dispute, you can take the case further.
You’ll want to get in contact with the Information Commissioner’s Office and give them details of your issue. As you’d expect, this is a significant step to take, and you’ll be expected to offer full details and documentation relating to the error. How ever you go about removing those errors, it’s worth it for an accurate credit rating.