Loans FAQ
Can I improve my credit rating?
There is no simple way to instantly improve your credit rating, despite what some people may say (especially people selling quick-fix plans). Many 'strategies' touted on the internet involve basically switching your identity to leave your old credit history behind - this is not only drastic, it's tantamount to fraud and against the law in most cases.
There are some ways of helping to restore your credit worthiness though, and in this situation every little helps!
Firstly, get a copy of your credit file and check it carefully for any errors. Sometimes, the information held on it may be out of date. For example, a debt may not be marked as cleared, even though you paid it off years ago - it seems much easier for adverse information to find its way on to your file than helpful information!
If there are any mistakes, you have the right to ask the credit reference agency to correct them. If you can prove that the information is incorrect, they are legally bound to correct it. Even if they dispute the correction, you have the right to have your own comments entered on to your file, so at least you can give your side of the story.
Also, make sure that all the information is actually about you or your spouse or partner, if applicable. Sometimes, defaults or arrears built up by a previous occupant of your home may find their way onto your file. If this happens, you can file what's known as a 'Notice of Disassociation' which removes any link between you and another person who is financially unconnected to you, and the information will be removed from your file.
You may see on your credit file that you have a lot of small debts which remain unpaid. Try and clear as many of these as possible - and make sure that this is reflected in your file.
Finally, make sure that you keep up with repayments on any current credit you have, such as credit cards, as most credit companies now report repayments to the credit agencies, helping to build up some 'good' history which will, over time, start to outweigh the 'bad' history, leading to an improved credit rating.
As said at the start of this article, there's no quick fix for a bad rating, but by trying to get everything in order by clearing up old inaccurate information, paying off any outstanding defaults, and sticking to your future repayments, your situation can be improved over time.
