Posts Tagged ‘credit score’

If you’ve experienced problems getting a loan for a property investment purchase, or have checked your credit score and found it to be lower than you’d expected, don’t panic. There are things you can do to try and improve your credit score – they won’t necessarily work immediately, but over time they can have a positive effect and improve your chances of being accepted for loans or mortgages.

Pay your credit card bill in full each month

One of the issues your credit score is ranked on is how efficiently you pay off your any existing credit, such as your credit card bill. Paying the full amount off each month, and doing so on time, will help boost your credit rating and show that you’re responsible with the money you have.

If you’re prone to forgetting to pay your bill on time, or are frequently travelling when the bill arrives, then the easiest way of paying it off on time every month is to set up a direct debit payment for the full amount.

Likewise, it’s best not to spend over your credit card limit, as it gives the impression that you can’t live or spend within your means.

Get listed on the electoral roll

Being listed on your local electoral roll can play a positive part in helping you get credit. If you’re unsure if you’re listed, contact your local council to check and, if your name isn’t down, get it on the list. Although the council do send out forms about once a year, if you’re keen to get going with improving your credit rating, it’s better to get on with it, rather than wait to be asked.

Space out applications for loans

If possible, try not to apply for lots of loans or credit at once, as details of all your applications will come up in your credit rating file and it can affect your score. This covers anything from mortgage loans and car insurance, to credit for buying large electrical products or mobile phones.

Maintain a fixed address and phone number

Having a fixed home address and a home phone number, rather than giving a mobile number, can also boost your credit score. If you have moved house a lot in recent years, then don’t try and hide it – be honest about your previous addresses.

Do you know your credit rating? Knowing what your credit rating or credit score is might not seem like a big deal, but it’s something that property investors should be taking more notice of.

In the past, when buy-to-let mortgages were easier to come by and often given according to the proposed rental income from a property, your credit rating may not have played such a big role, but things have changed. For those applying for a buy-to-let mortgage in the current economic climate, more attention is paid to your credit score and this can affect the outcome of your application.

Credit scoring systems are used by companies such as banks, credit cards, insurers, mortgage lenders or insurers to rate and predict your behaviour. Although it’s often assumed that there is one universal credit rating list in the UK, this isn’t the case. There are in fact three main credit reference agencies, namely Experian, Equifax and Callcredit, and all three hold information about you. What’s more, the information may differ.

If you’re thinking of applying for a buy-to-let mortgage in the near future, or any other type of loan, then it’s useful to get an idea of what your credit rating, or credit score, not least as sometimes incorrect information can get on their files.

If you have a check done, then it is recorded on your file, but no lenders will be able to see this information and it won’t affect any loan applications you make.

It can sometimes take time to get the results through, so best not done in a rush, but as it could make the difference between being able to buy the property you want to invest in, or losing out on it, it’s worth it. Plus, if they turn out to have incorrect information on their files, you’ll have the chance to get it corrected, which could seriously help your loan application.