Any time you apply for credit, from a personal loan to a mortgage, a lender will look at your credit score. Also known as your credit rating, it’s the numerical value that is assigned to you based on everything that appears on your credit history.
Credit scores are calculated by credit reference agencies such as Equifax, Experian and TransUnion. They’re used by lenders and credit providers to determine if you’re a good candidate for a loan or other credit product.
Here are our expert tips to improve your credit score and get it in top shape.
Quick overview of how to improve your credit score
If you’re looking to give your credit report a boost, here is a summary of the top 10 ways to improve your credit score in the UK:
- Register on the electoral roll
- Always pay your bills on time
- Make sure your credit file is correct
- Check for identity theft or fraud
- Avoid county court judgements (CCJs)
- Reduce existing debt
- Staying at the same home
- Maintain a good credit utilisation ratio
- Consolidate your debt
- Open a credit account
What is my credit score?
Throughout your life, your ability to manage various types of credit will be recorded on your credit report – and that activity forms the basis of your credit score. It will include any application you make for credit and also any missed or late payments.
If you have a low credit score, lenders may view you as a borrower who’ll either miss or make late payments, which can result in being denied credit or getting approved with more unfavourable rates and terms.
There are 3 main credit reference agencies that calculate your credit score. You might find that your score varies depending on the CRA you’re using, this is because they all have their own unique scoring software.
How do I improve my credit score?
If you have a poor or fair credit score, there are a number of things you can do to boost your credit rating. However, there’s no quick fix and if you want to boost your credit score you’ll need to view it as an ongoing process.
Your financial history plays a big part in determining your credit score but it’s also important to make sure your personal information is up-to-date, correct and accessible by lenders.
Here are the top 10 best ways to boost your credit score:
1. Register on the electoral roll
This is possibly the easiest way to help build your credit rating. Being on the electoral roll gives lenders proof that you are who you say you are when you apply for a credit product and helps them ensure that you’re a real person. It’s free to register, via the gov.uk website.
2. Always pay your bills on time
Whether it’s for your phone, broadband, energy or credit card, paying your bills in full and on time shows potential lenders that you’re responsible with your finances and capable of managing ongoing debts. Setting a direct debit for regular bills is an easy way to avoid forgetting a payment.
3. Make sure your credit file is correct
It’s important to regularly check your credit report for any errors in your personal details or financial history. Even relatively minor mistakes like having the wrong date of birth or the wrong address can have a negative impact on your ability to get credit.
4. Check for identity theft or fraud
You should check your credit file regularly for potential fraudulent activity, such as someone applying for credit using your name or details. If you find anything suspicious, you should contact the credit reference agency directly as soon as possible. If you think you’re a victim of fraud or identity theft you should also contact your bank and report the crime to the police via the Action Fraud website or phone number on 0300 123 2040.
How to protect yourself from identity theft and impersonation scams
Liz Edwards
Editor-in-chief
Identity theft is when someone uses your name and personal details to apply for credit or buy items in your name, and you're landed with the bills. In an impersonation scam, a frauster pretends to be a trusted organisation such as your bank or HMRC, and persuades you to move money to their account. Here are some ways to protect yourself:
- If you get a call or message from an unknown number from someone claiming to be from an organisation you know, be wary and call back on the official number. The same goes for messages from people who claim to be friends or family - call back on the number you know, to check.
- Never feel under pressure to act. Fraudsters create a sense of urgency to rush you into complying, but a legitimate company should allow you time to consider.
- Watch out for attachments and links in emails or text messages from anyone you don’t know, even if they look legit. Links can allow malicious software to access your device. Instead, go through a company’s official website directly.
- Guard your personal information and never share your full birthday or address publicly online. Fraudsters can use basic personal details to get more, which could then be used to impersonate you.
5. Avoid county court judgements (CCJs)
Receiving any county court judgements for debt, or any other form of bankruptcy or default, will seriously affect your credit score. It will also make it much harder to get a loan or credit product in future. If you are struggling to make debt repayments, contact your lender and don’t put this off. It should be able to offer you a repayment plan. There are also free, confidential debt charities including StepChange which can offer help and advice.
6. Reduce existing debt
If you’re still paying off a loan or credit card, you should prioritise getting these debts down as much as possible or paying them off in full if you can. Ideally, you should pay off most or all of your existing loans before applying for a new one.
7. Staying at the same home
While it’s not always possible, having a stable address for an extended period of time, whether you’re an owner or renter, reflects well on your credit file and may make lenders more likely to consider you for a loan. But if you do move, make sure you update your address on all of your financial records.
8. Maintain a good credit utilisation ratio
Your credit utilisation ratio is the amount of your credit you use compared to your overall credit limit. For example, if the total of your combined credit limits is £1,000 and you’re using £400, then you’d have a credit utilisation ratio of 40%. You should always try to keep your ratio below 25% if possible.
9. Consolidate your debt
If you have multiple debts, it may be a good idea to try to consolidate them using a debt consolidation loan. This can make it easier to manage your debt payments and show potential lenders you’re responsible about paying off your existing debt. You may even be able to reduce your repayments if you can find a loan with a lower interest rate.
10. Open a credit account
If you have limited credit history, you should consider opening a small credit account, such as a credit-builder credit card, to help build your credit. Just make sure to pay off the card on time each month, otherwise you may end up negatively affecting your credit rating.
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What is a good credit score?
Unfortunately there’s no universal credit rating system, so a good credit score could be defined as one that doesn’t negatively impact your ability to get approved for credit and ideally helps you get access to the best interest rates and credit products.
Different credit reference agencies use their own ratings systems to calculate your credit score, so what’s considered a good score with TransUnion, for example, won’t necessarily be considered a good score with Experian and vice versa. The credit ratings systems of the 3 major credit reference agencies are:
Experian credit scores and ratings
| Experian score | Experian rating |
|---|---|
| 0–560 | Very poor |
| 561–720 | Poor |
| 721–880 | Fair |
| 881–960 | Good |
| 961–999 | Excellent |
Equifax credit scores and ratings
| Equifax score | Equifax rating |
|---|---|
| 0–438 | Poor |
| 439–530 | Fair |
| 531–670 | Good |
| 671–810 | Very good |
| 811–1,000 | Excellent |
TransUnion (formerly Callcredit) credit scores and ratings
| TransUnion score | TransUnion rating |
|---|---|
| 0–550 | Very poor |
| 561–565 | Poor |
| 566–603 | Fair |
| 604–627 | Good |
| 628–710 | Excellent |
What lowers your credit score?
- Applying for too many loans or credit products. Each time you apply for credit, the lender will perform a hard credit check, which will be recorded on your credit file and be visible to other lenders. If you apply for a lot of credit products in a short period of time, you’re likely to suffer a hit to your credit score, as providers will see you as a risk.
- Using too much of your available credit. While your credit limit is there to be used, lenders will consider it a red flag if you’re constantly using most or all of your available credit limit. It’s important to try to keep your credit utilisation ratio below 25% if possible.
- Failing to repay debts on time. Any late or missed payments will be recorded on your credit file and have a negative impact on your credit rating. They aren’t permanent but will stay there for 6 years.
- Taking out too many short term loans. This will generally be seen as a red flag by lenders as it suggests you have problems managing your money.
- County court judgements (CCJs) or bankruptcies. Any form of default on an existing debt or loan will naturally have a huge effect on your credit rating and is likely to make it a lot harder to be approved for credit going forward.
- Incorrect information on your credit file. If your credit file contains lots of errors or mistakes it will make you appear less trustworthy to lenders and impact your credit rating.
- Opening a joint account with a friend or family member with a poor credit score. This can affect your own credit score and you’ll be jointly liable for repayments.
Why should I improve my credit score?
Your credit score is fundamental to getting credit, from car finance deals and credit cards to mortgages or personal loans. Any time you apply for credit lenders will look at it so it’s important to improve your score if it’s low.
That’s because the higher your score, the higher the chance you will be approved for credit. Lenders will also decide what interest rate to offer you based on your credit score. Most of the cheapest rates are only available to people with good credit scores. The amount of credit you’re approved for will also depend on your credit score.
How long does it take to improve your credit score?
Unfortunately you can’t improve your credit score overnight, and it can take some time, especially if you already have some black marks on your credit file. Improving your credit score is a matter of repairing any existing negative marks and also building positive credit history, both of which can take anywhere from a few months to a couple of years.
In addition to making payments on time and not getting yourself into lots of debt, you need to consistently show you’re able to manage your debt repayments and that you’re on top of your personal data. If your credit score is low, it’s a good idea to focus on maintaining healthy credit habits and wait until the black marks reach their expiration age on your credit report.
Can you boost your credit score fast?
There is no tried-and-tested way to quickly improve your credit score. It’s better to think of your credit score as an ongoing thing and instead focus on building good credit-building habits that you can sustain over time. This includes making sure you always pay your bills and debts on time and regularly checking the details on your credit file.
Frequently asked questions
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There’s no single standard for credit scores and each of the 3 main credit reference agencies have their own scoring system. A “fair” score with Experian would be between 721 and 880 while with Equifax it’s between 439 and 530.
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It’s a marathon not a sprint and improving your credit score isn’t something that can be done quickly. The best way to improve it is by implementing good credit habits, like those mentioned above, and checking your score on a regular basis to make sure it’s correct.
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It’s a good idea to keep old financial accounts open if they can show your credit history. Lenders will look at these so if you have an account that shows you can successfully manage your credit over a long period of time this will be a bonus.
Generation Fraud: Is social sharing putting younger generations at risk?
Finder published a report in December 2023 exploring UK fraud trends and the risk of fraud for younger generations who share more about themselves publicly. The report includes the findings of our survey of 2,003 UK adults, plus insights from broadcaster Iona Bain, Paul Evans of Featurespace, Mike Harlock of Moneybox, payments consultant Ebru Keskin, John Somerville of the London Institute of Banking and Finance and fintech specialist Erica Stanford.
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