Get on the electoral roll

When you sign up to your local Electoral Registration Office, two things happen:

  1. You will become a registered voter for your address

  2. There is an official record you live at your address

This improves your credit score, as lenders can easily identify where you live by accessing the electoral roll.

Use a credit card

This can help improve your credit score, especially if you pay off your balance after making a purchase on your credit card.

This helps build your credit score as it proves you can get into and out of debt, showing you are reliable when repaying what you owe.

However, you should avoid withdrawing cash from a credit card, as this will leave a mark on your credit record and cost you interest.

Never miss a repayment

If you miss a repayment on a credit card, loan or mortgage, it will get recorded on your credit history.

This will have a negative impact on your credit score, so make sure you have enough money to pay your bills each month to avoid this happening.

For credit card payments, consider setting up a direct debit that takes at least the minimum amount each month to avoid ever missing a repayment.

Check for credit record mistakes

Your credit score may be affected if information about your financial history is incorrect on your credit record.

Look for anything that isn't true, such as a wrong address or a missed payment that you had paid on time.

Check your credit record before you apply for any credit accounts to improve your chances of getting accepted.

Avoid payday loans

If you need to borrow money quickly, do not consider a payday loan unless you have no other options.

A payday loan application shows up on your credit record, and your credit score will get negatively affected even if you get accepted for the loan.

This is because payday loans indicate that you are desperate for money, and unable to get a cheaper alternative way of borrowing.

Avoid unauthorised overdrafts

Most current accounts let you go into a negative balance, also called an overdraft. The type of overdraft you use can affect your credit score:

  • Authorised overdraft: This is an agreed amount you can go into a negative balance. There could be charges for using this but using it should not negatively affect your credit unless you are always in it.

  • Unauthorised overdraft: This is when you go into a negative balance without your bank agreeing to it. You will get charged daily, and this will appear on your credit record.

Contact your bank and ask for an authorised overdraft if you think you'll need it, rather than going into an unauthorised overdraft.

Avoid too many applications

Your credit record will show every credit application you make. If you get declined, avoid making a new application for a few months.

When you make multiple credit applications, you will appear as desperate for credit, which will affect your credit score.

Before making a credit application, look for an eligibility checker to give you an indication of whether you're likely to get accepted.