Credit reports have been the centre of lending and borrowing since they were created back in the 1950s. Although they impact on so many different parts of our daily lives, it’s amazing how few of us use them when it comes to managing our finances.
Credit reports are often just seen as a way for lenders to take a look at a potential borrowers credit history. Whilst this is true, it’s just one side of the coin.
Let’s take a closer look at why they are so important, who provides them, and where you can take a look at your credit reports free of charge.
The first thing that jumps to mind when talking about credit reports are the credit searches carried out by lenders. Credit reports build up a detailed picture of your borrowing history and can use this along with other factors to determine your creditworthiness.
Taking into account the status of previous loans, existing credit agreements and even your appearance on the electoral role, you’re allocated a credit score. This will place you in one of the following categories:
For consumers, credit reports can help you to keep a detailed eye on all of your existing lines of credit, as well as keeping you informed of any credit checks that have been made. You’ll also be able to track any reasons that might be hindering your score such as defaults, CCJs or arrears.
Been unexpectedly refused credit for a loan, credit cards, mobile contract or mortgage? Your credit report is the first place to start. Try to gather your score from a few different sources then take a look at all of the factors that are having a negative impact on your report. If there’s anything that stands out then either try to resolve it with the company involved or raise a dispute directly with the credit reference agency.
Monitoring this information can help to protect you against identity fraud. If you there are any applications or credit searches that you don’t recognise, get in touch with the relevant company straight away.
At the very minimum, the vast majority of credit reference agencies offer a 30 day free trial to take look through your credit history. There are plenty that offer credit reports free of charge for life, making them a fantastic resource for avoiding costs whilst still providing a plethora of useful information.
Here’s a quick run down of the major credit reference agencies that operate in the UK:
Experian | As one of the country’s leading credit reference agencies, you’ll be able to check the information they hold on you completely free of charge. They do offer a paid for service which can provide advice on how to improve your score along with a more details financial analysis, but the basics can be picked up by simply completing some basic details on your address history, name and date of birth.
Equifax | Another credit reporting heavyweight, Equifax offer their full service as part of a free 30 day trial. They’re big on security and helping you to protect your identity, so expect to find plenty of useful information in their blogs as well as a thorough breakdown as to how you can build/maintain a healthy score.
Noddle | Noddle were one of the first ever credit report agencies to offer their services with no charges whatsoever. Rather than charging users a subscription fee, they match customers with a range of financial products and offers, earning money through referrals. The system is very easy on the eye and provides a useful starting point for managing your credit reports.
ClearScore | ClearScore works in a very similar way to Noddle in that they’ll provide you with a free for life service whilst making suitable products available to you as your score changes. They’ll also send you an automatic monthly update to keep you in the loop each month as your score fluctuates.
Picking up a free credit report takes just a couple of minutes and only requires some basic information from you to get started. Enter your name, date of birth and addresses over the past 3-5 years, and they should be able to identify you straight away.
Some may ask for your basic bank account details along with security information such as your mother’s maiden name, but all in all it’s information that you should have to hand.
It’s really important to remember that if you do sign up for a free trial service then make a note of the date that you signed up and the date you’ll need to cancel your trial by to avoid being charged.
Simply visit one of the credit reference agency sites listed above and follow the on-screen instructions.
*UKCreditRatings offer a 14-day trial to their credit report service. If you choose not to cancel within the trial period, you will incur the monthly subscription fee of £19.95 until you cancel the account. Credit Raters is a free financial comparison website owned by Season Marketing Ltd which is a company registered in England and Wales (Company number 08901402). Season Marketing Ltd's registered office; 71 - 75 Shelton Street, London, England, WC2H 9JQ. Season Marketing Ltd is authorized and regulated by the Financial Conduct Authority and entered on is the Consumer Credit Register under reference number: 727385. Licensed by the Information Commissioners Office, (registration number ZA064129).
