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How to Improve your Credit Score in Derby

The higher your credit score the more chance there is for first time buyers in Derby mortgage application being accepted although this doesn’t guarantee that an applicant will be accepted due to lenders having their own internal scoring systems. 

Each Lender has developed their own niche which means you won’t fit in every lenders criteria, so don’t worry if you fail with one lender. If you do fail to meet a lenders criteria then there will always be another one who will be more forgiving. 

It is our job as a Mortgage Broker in Derby to match you to the right lender and hopefully getting it right first time but sometimes that doesn’t always happen due to the lender. Despite this, both you and your Mortgage Advisor want the same thing which is that you end up with the best deal available to you so we are sure our Mortgage Advisors in Derby make this happen. 

There are several different credit reference agencies in the UK, including Experian and Equifax. It is a wise idea to check as many of these agencies as possible so you gain more clarity of your current credit score. Additionally, it is also possible that one of the agencies might hold incorrect data by checking with multiple agencies, you’ll be able to identify any such discrepancies.

There are some good practices listed below in regard to things you can be doing to improve your credit rating: 

Avoid Unnecessary Credit Searches

Multiple credit searches are able to produce an adverse effect on your score. Keep this in mind when using price comparison websites as these are often the ones who carry out credit searching on individuals. If you know you want to apply for a mortgage soon then you’re better off trying to avoid applying for any other credit.

Some credit is great to have and paying it back is great for the long run, however, lenders don’t like to see you increasing your borrowings just prior to making a mortgage application. 

Check You Are on the Voter’s Roll

Being on the electoral roll will help your score drastically as it shows stability and lenders favour this. Ensure that your name is spelt correctly and your current address is registered at. If you are not registered it’s easy to do this online. 

Don’t Run Close To Your Maximum Limit

Your score can further be reduced if you max out your credit cards regularly. Using a credit card and paying off the balance in full each month is preferable. This indicates that you are good at managing your money. Worst of all would be exceeding an agreed card limit or overdraft. Lenders want to know that you take your finances seriously. 

Check Your Address History Is Keyed Correctly

It may appear that you’re living in two places at the same time on your credit report. This occurs for a variety of reasons, perhaps that you may have forgotten to tell one of your credit providers that you have moved. Check all addresses are updated and are correct. If in the past you have lived in a flat this can be tricky as the flat/apartment number can be formatted in different ways. 

Close Down Any Unused Credit Accounts

Make sure to contact the providers of store/credit cards that you no longer use in order to get the account closed. In the short term this can have a negative effect on your score briefly as the credit reference doesn’t really know if it’s you closing the account down or the provider. This is also a good thing to do to so that you reduce your chance of becoming a victim of fraud of a card you don’t use regularly. 

If you have a family member or ex-partner connected to you then this could also affect your score. However, you won’t be able to get the financial association removed if the account is still live. To remove one of these links contact the credit reference agencies and make a request.

Many consumers feel credit scoring is unfair but lenders’ attitudes are indifferent. It is much cheaper for them to operate this way and computers offer a more consistent outcome.

Send an up to date copy of your credit report to a Mortgage Advisor in Derby upfront and you will increase the chances of being accepted first time. The more the Mortgage Advisor knows about your finances the better. Also, there are still some smaller Lenders that do not credit score. These Lenders do it the old-fashioned manual way, yet they will still have certain rules about the number of defaults and CCJ’s allowed. 

Date Last Edited: December 6, 2023

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