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Your credit file: what is it and how can you improve it?

We’ve all heard how important our credit file is. We hear that we need this to be in top condition for us to be able to go ahead and gain credit. It is our credit file that shows lenders how we have managed our finances and other credit agreements. It provides them with an insight so that they can make a judgement as to whether or not to lend to us. Whether looking at credit cards, loans, mobile phone contracts or mortgages, our credit files can help. For one, they see us much more likely to be accepted. Secondly, the better our credit file the better the interest rate we will be offered.

So, knowing how important this whole credit thing is, how many of us really know what it involves? The truth is that there are so many myths surrounding what a credit file is that it is understandable that there is some confusion. Let’s try and clear it all up by looking at exactly what is on our credit files, what isn’t, and what lenders can’t actually see. We’ll then also take a look at some tips to get your credit file in the best shape possible.

What is a credit file?

Your credit file is a collection of data that is all about your borrowing history. The information is reported to credit reference agencies who put together your credit file and give you a credit score. There are three credit reference agencies in the UK: Experian, Equifax, and TransUnion. You are able to view your credit file and to see all of the information that is held about you. You may choose to go directly to the agencies or you good also use companies such as Credit Karma or Clear Score.

As your credit file shows how you have handled you credit commitments, such a your repayment history, it allows lenders to make an informed decision when you apply to borrow from them. Your credit file will help a lender in serval ways:

  • They will use it to confirm your identity
  • They will use it to confirm your address
  • The information will allow to decide if they are willing to lend to you
  • If they do lend to you, it is the information on your credit file that will allow the lender to decide on the interest rate and other terms.

What is in a credit file?

There are certain details that feature on our credit files that are visible to lenders when we make an application. These details basically allow lenders to make a judgement when it comes to how we handle our finances. They will look at how likely we are to repay any credit that we take on. This is the information that they will see and use:

Your name and address

A basic one to start with, but yes, lenders will want to know who we are and where they can find us. They need to know who they are lending funds to and they need to be able to identify properly to rule out any potential fraud.

Financial accounts

Lenders will be able to see details of other financial accounts that we may hold. This includes bank accounts, credit cards, loans, and financing.

Court records

A credit file will also contain details of public records that are attached to us. This means that lenders will be able to see any bankruptcies, CCJs, defaults, and fraud. Of course, these are points that make our credit file look less than appealing to lenders!

Electoral roll

Lenders are able to see details from the electoral roll. This will allow them to see our current address, as per the register, as well as our previous address history. This goes some way to helping confirm our identity.

Payment history

Lenders can see how well we have managed our current, and past, commitments. They can see if payments have been made on time, been late, or missed altogether.

Hard credit checks

When applying for credit, lenders will carry out a hard credit check on the applicant. This is what allows them to see the credit file. Lenders will be able to see that other hard checks have been carried out.

What’s not included in a credit file?

Despite what we may have all been told, there are certain pieces of information that don’t go into making up a credit file. Some of these may actually surprise you:


Lenders can not see our levels of income. This is not something that is included in a credit file, but that is not to say that they won’t know. It is highly likely that they will ask for this information as part of an application form

Relationship status

Married, single, partner, widowed, or civil partnership, this information is not included. Again, a lender may ask for this information as part of an application form though. What a lender will be able to see is if your are financially linked to anyone. A financial link is created by having a joint loan, credit card, or bank account.

Criminal history

Lenders are unable to see any details of any criminal history. If someone has received a caution, being charged, or even convicted, lenders are not privy to this information.

The outcome of credit applications

We are often told that multiple failed credit applications are bad for our credit files. The truth is that the outcome is not even recorded on a credit file. It does show the fact that applications have been made so if there are numerous of these then lenders may just assume all is not well! That is why multiple applications can be harmful to your chances of getting credit.

The bits that lenders don’t see

There is some information that credit reference agencies hold about us all that only we can see. Here is what’s not shared with lenders:

Our credit scores

Surprisingly, credit scores are not part of a credit file. These scores are created by the reference agencies to give us an indication of how we are doing. Lenders will never see this.

The names of your current lenders

When applying for credit, the lender can see our payment history and our levels of credit utilisation. What they don’t see, or know, is who we have credit for or why we have taken out that credit.

How can a credit file be improved?

Now that we have taken a look at what our credit files actually contain, the next step is knowing how we can take control of this. Remember, the better the state of our credit files, the better deal we will get when it comes to taking on new credit. Here are some simple steps to help get our credit files back in order:

Get added to the electoral roll

We have already seen that lenders can access the electoral roll and our information on there. Not appearing on the electoral can cause damage to our file but it is probably one of the easiest things to put right.

Keep payments timely

Make sure that direct debits have been set up for any regular payments that there are. This means that we can not simply forget to make them.

Aim to close off old debt accounts

What gives a significant boost to your credit file are signs that you honour your commitments. One of the best ways to do this is to repay your debt and see an account closed in good standing. If you have loans with small balances outstanding, you should endeavour to clear these. The account will then be settled and you will have proven that you repay your debts.

Focus on debt utilisation

Just because we have been given access to credit, doesn’t mean that we have to use it all. In fact, if we do, this will cause damage to our creditworthiness. Lenders like to see that we only use a certain amount of our credit (30%-40% is good). Maxing out every line of credit sets alarm bells ringing and suggest that we are poor at managing our money.

Build your credit with Wollit

If you are looking for a great way to build credit then what we offer at Wollit is a fantastic solution. The Wollit app allows you to start using our credit building service after signing up, which only takes a few minutes. By subscribing at a cost of £9 per month, we will report your monthly payments to all 3 UK credit reference agencies. This builds your positive credit history, the single most important factor affecting your credit score.

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