#4 Assembling your Credit Report

Understand what kind of credit data makes up your credit report.

Here’s a summary of the key data that’s included on your creditreport and what they mean.

Your Name and Address

Each CRA will hold your name and address. They may also holdmultiple versions of your name if you’ve ever spelt it differently, or a lenderspelt it differently, on an application form.

Electoral Roll

Each CRA will be able to tell if you are on the Electoral Roll atyour address. As we’ve mentioned before, if you aren’t, you should be! If you’ve just registered, you’ll need to allow a few weeks for the systems to update.

CCJ Data

If you’ve been subject to a CCJ (County Court Judgement) this willshow on you credit file for 6 years from the date it is satisfied.

Gone Away

If you’ve moved address or left the country owing money, this information will bestored on your credit history.

Fraud Warnings

If you’ve been caught committing any kind of fraud this could benoted on your credit report for others to see.

Take your time to read over these points and assess whether any of it is applicable to you. Understanding what kind of data makes up your credit file can shed light on where and what you can improve.

Is credit bad?

We’ve already covered that in order to build a credit history you need to take out credit. One of the big misconceptions we come across is that ‘credit is bad’.

While taking out credit can potentially be dangerous if you over extend yourself or don’t make the repayments on time. It is really positive to demonstrate your ability to repay, so that in the future when you need to get credit for a large purchase like a house or car you’ll have the best chance of being approved.

Task #5 Vary your credit.  

 Many lenders prefer their customers to have a variety of credit accounts on their report as this demonstrates to them that you’re financially stable. Start by checking what kind of credit accounts are on your credit report. Hence, consider taking out an alternate type of credit to those which are already visible on your report.

For example, a credit card if you don’t have one already. Just make sure you pay it off in full each month, and keep your utilisation of it below 30% to maximise the positive impact it will have on your credit score.

Onwards to Lesson 5