How is a credit score calculated? A credit score is a value assigned to several criteria used in making lending decisions made by UK mortgage lenders. Criteria include the amount you owe on non-mortgage-related accounts such as credit cards and loans, your payment history and credit history.
Scorers take this information from your credit report and plug it into formulas that calculate a value representing the amount of risk you pose to a lender. That value takes into account the track record of other consumers with similar credit profiles. By looking at this value, or score, lenders are able to roughly gauge whether it's a good idea to extend you credit.
Lenders will never reveal exactly which things have a greater effect on your score but the obvious things to try and avoid are CCJ’s, defaults, IVA’s, etc. It’s also important to remember that Experian and Equifax show your payment history on all loans and store cards etc. Payment history shows not only if you’re up to date but your payment history for the last 36 months. So every time you paid one month late it shows. Most lenders will ignore 1 or 2 months late payments but get very concerned if they see +3’s at all.
It's possible there are discrepancies among information held about you so it is wirth checking your file to make sure it’s a true reflection of your history.
If you feel you have "Bad Credit" please visit our bad credit mortgage section, as we may have information that may help you.
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