If you've ever been refused for a loan, HP or any other type of financial credit, you may be left wondering why. If you're one of the thousands in the UK who never check their credit file, it may be worth doing so as soon as you can.
It's been discovered that almost 16 percent of people who did check their credit file found errors on it which could lead to credit refusal. With banks clamping down on who they lend money to, the slightest black mark on your report could go against you, even if it's not your fault.
There are different reasons why errors could appear on your file. When a company performs a credit check as part of an application for finance, a listing appears on your file saying who did the search, and when. If the company does more than one search at the same time in error, more than one listing will appear, giving the impression of several separate searches.
Sometimes a company with whom you've paid off a debt can fail to register it as such. To any subsequent searches, this debt will appear as unsettled, giving the impression of outstanding monies owed or perhaps even defaulted on.
It may even be that you've been the victim of identity fraud; if a criminal manages to get hold of your card details they could potentially do a lot of damage to your credit score, without you even knowing about it. If this has happened to you in the past and was stopped, check your file to make sure nothing untoward has been left.
If you do find any errors on your file, the first thing to do is contact the relevant companies. If a paid debt is still listed as unpaid, request that the company rectify this. Same goes if they've filed numerous searches without your permission; they should be able to remove all but the first, original search. You can also have a 'Notice of Correction' put on your file stating which errors are evident. Any company searching your file has to take correction notices into account.
In the case of identity fraud, you will need to contact the police and the credit reference agencies in order to repair any damage done to your file. Again, a notice of correction can be placed on your file to inform of this.
If you wish to apply for credit such as loans, get a copy of your file to check. Personal loans especially will require a good credit rating. For small amounts (under £1000), consider payday loans as they don't require a credit search.
