Your Credit File
Whenever you apply for credit, it's almost certain that some form of credit check will be made before you're approved. This usually involves consulting your credit file or credit record. But what exactly is this file?
Your credit file is a record of your financial history and is maintained by a company known as a Credit Reference Agency. There are two major credit reference agencies in the UK, Experian and Equifax. These companies collect various pieces of information concerning your finance and credit history, and sell this information to loans companies, credit card issuers, and anyone else who needs it to make a decision about offering you finance.
What details does my credit file contain?
Details of your previous credit applications, and whether or not they were successful, are recorded. Any late payments, defaults, CCJs, or debt recovery proceedings will be recorded, and some companies also report on 'good behaviour' which will also be kept on your file.
Additionally, every request for your file details (known as a credit search) will be recorded.
Can I see my file?
Yes. You can write to the credit agencies and request, for a small fee, that they send you a copy of your file. Alternatively, there are many credit reporting services which will provide a similar service, such as Checkmyfile.com.
What if information is incorrect?
If after looking at your credit file you discover that incorrect information is contained, you can request that the errors are corrected. If you can prove that the details are wrong, the credit agency is obligated to correct the mistake. If there is a dispute over some information in your file, you are entitled to enter your own comments on to your file explaining why you disagree with an entry.
If your credit record contains details of old debts that you have since cleared, you should ensure that your file includes the information that you have now repaid the debt.
Does my file decide whether I can get credit?
Only in part. Credit companies will use the information on your file as part of a larger process known as credit scoring. Some companies may be happy to lend to people with a certain amount of bad credit information on their files, others may be willing to offer credit even if your credit file contains records of serious debt.
In any case, checking your credit file for errors and ensuring that they are corrected will give you the best chance of obtaining finance!
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Article contributed by www.bad-credit-solutions.co.uk - offering advice on coping with a bad credit rating, debt consolidation, debt management and more |
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