What is a credit score?
When you apply for credit, a few things help lenders to make decisions, including your credit score.
For a quick run through, watch our short video.
What else do lenders check?
Protecting your credit score
- Declined applications
If you submit a full credit application, a full or ‘hard’ credit search will be completed. If you’re declined, this will affect your credit score.
- Multiple applications
If you submit a number of full credit applications in a short time, that can also negatively impact your credit score. If you’re declined, it’s a good idea to wait 6 months or more before trying again.
- Missing payments
You must keep up with payments, making at least the minimum payment by a set date each month. Missed payments are reported on your credit record.
- Going over your credit limit
If you go over your agreed credit limit, that might be recorded on your credit record too.
Tips for managing a credit card
Boosting your credit score
It’ll take time, but there are things you can do to improve your credit score:
- Always pay bills on time – including credit card, utility and other household bills.
- Manage accounts well – stay below your credit card limits and try to reduce your balances whenever possible.
- Wait to apply again – avoid making a number of credit applications in a short period.
- Register to vote – make sure you’re on the electoral register.
Frequently asked questions on credit scores
All lenders have different criteria for assessing applicants. If you have a low credit score, that doesn’t necessarily mean you can’t borrow, but you might not be offered the lowest and longest lasting interest rates, or a high credit limit.
To find and compare cards you’re likely to be accepted for, without impacting your credit score, look for lenders who offer an eligibility check first.
Each credit reference agencies collects similar information, although not necessarily the same, so it’s a good idea to check more than one before you apply for credit of any kind.
As well as information about the way you manage credit accounts, credit reference agencies also collect public information, such as electoral register and court records.
If you’ve checked the information held by a credit reference agency and there’s an error, you can contact the agency and ask them to investigate.
If there’s definitely an error, they’ll make a Notice of Correction, which anyone reviewing your credit history in the future will see and take into consideration.
If you’ve never had a credit card, or have limited experience with credit full stop, your credit score can reflect this. With no track record of being a responsible borrower, your score could be pretty low.
Many people get their first credit card as a way to build up a stronger credit score for the future. If you’re relatively new to credit, we’ve published useful guides which should help.
A summary on credit scores
Credit scores are issued to you by the credit reference agencies in the UK.
- Low risk borrowers have a higher score. A low score indicates limited experience, or a higher risk.
- The lowest and longest lasting interest rates are offered to those with the best credit scores.
- You can check your ratings with each agency. At Halifax we use Experian, TransUnion and Equifax.
- The information held by each agency may differ, so it’s a good idea to check more than one.
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Halifax is a division of Bank of Scotland plc. Registered in Scotland No. SC327000. Registered Office: The Mound, Edinburgh EH1 1YZ. Bank of Scotland plc is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority under registration number 169628.