Credit Score


Many people wonder what a good credit score is and what it can mean for you. As we’re here to help the Police Family financially, we wanted to help clear a few things up.

A credit score is a personal rating, determined by information given to a credit reference agency (the credit reference agencies used in the UK are Equifax, Experian, Crediva and TransUnion). They collect and hold information such as your debts, how many credit applications you have made and whether you have been making repayments. The data collected from credit reference agencies provides potential lenders with an idea of how you manage your money, this helps them to predict future behaviour, to see if you are someone they would be happy lend to.

Top tips for a tip-top credit score

  1. Ensure that you are registered on the electoral roll
  2. Try not to change your main bank account too often. One, established account could look better on your credit file
  3. Avoid applying multiple times for credit within a short space of time
  4. Ensure you pay all your bills on time and don’t miss any repayments
  5. Don’t exceed pre-arranged credit limits. If you do this, you could be charged additional fees

Common misconceptions…

Credit scores are affected by a variety of things that you may not be aware of. If you are looking to improve or maintain your credit score, here are some things you made need to watch out for:

Q: Do people who used to live at my house impact my credit rating?

A: No. Unless you have joint accounts with them, they won’t impact your credit file.

Q: Do issues from over 6 years ago still matter on my credit file?

A: A default will stay on your credit file for six years from the date of default, regardless of whether you pay off the debt. After six years the defaults are classed as historic. After the six years, the lender won't be able to re-register your default even if you still owe them money. You should continue to make any remaining payments regardless of the length the debt has been ongoing as the lender may go on to register a County Court Judgement against you.

Q: Will viewing my own credit file lower my score?

A: No. Companies can’t see when you do this. In fact, it’s a good thing to do. You can check your credit file and score by using apps such as ClearScore, Credit Karma or Experian. When viewing your own credit file you are completing a soft search, this will not impact your credit score because you are not applying for credit. However, a hard search is more likely to have an impact on your credit file as you are applying to borrow money from a company. Hard inquiries often stay on your credit file for two years before they naturally fall off.

You may see on credit score apps that you are being given quotes for potential products. These quotes are only given from a soft search, and if the company uses representative APR, the rate you see may change after they have conducted a full credit search. A lot of companies have policies meaning they must conduct a hard search when making a decision, therefore it’s advised not apply for a lot of credit in a short space of time as it may give them the impression you have financial instability. 

Q: Will an unpaid parking fine affect my credit score?

A: Forgetting to pay a parking ticket could result in your credit file being affected.

Q: Will reaching my credit limit every month impact future credit applications?

A: Yes. Being at the top end of your credit limit each month can give the impression to potential lenders that you aren’t in control of your finances.

Q: Do previous credit arrangements show on my credit file?

A: Yes. Any previous CCJs, IVA, bankruptcies or court orders will show on your credit file. This includes any defaults or arrangements, including missed or late payments.

Q: If I have a shared account, will this affect my credit score?

A: Yes. Anyone you have had a financial relationship with, past or present will show on your credit file.