Why is your credit report important?
Your personal credit report is very important as it is being used by banks and lenders to when your applying for credit, such as a credit cards, loans or a mortgage. Based on the information in your credit report the bank or credit supplier will decide if your credit worthy and if the credit card, loan or mortgage can be supplied.
The three most common situations in which people get issues because of a bad credit report are:
- While applying for a (payday) loan
- While applying for a credit card
- While seeking funding for a house via a mortgage or a remortgage
A negative credit score will effect the rates you pay and deals you get on mortgages, credit cards and loans as financial institutions will charge higher rates to people with a bad credit history.
This is one of the main reasons to apply for a free credit report.. It will save you money
So what is in a credit report?
A credit report consists of information from two sources which are:
1. Public records: court judgments, individual voluntary arrangements, bankruptcies and electoral roll information.
2. Information from lenders and other financial agencies: credit accounts, credit applications and financial associations.
Based on both of the two sources a credit report is compiled which includes a Credit score.
There are several credit reference agencies who offer online credit reports but the largest and most reliable company is Experian, their Experian credit score and reports are being used by most companies in the industry.
Experian currently offers a via their thirty day online trial on their website