If you’re planning to apply for a mortgage in the next few months, then your credit score needs to be as sparkling as possible so you have a better chance of success and more access to better deals. Here’s nine ways to boost your credit score before you apply.
Put yourself on the electoral roll
Head to gov.uk to check whether you’re registered or not and, if you’re not, register yourself at your current address. If you’re not eligible to vote, send all of the UK’s credit agencies proof of your residency and address and ask them to add a note to your file confirming these details.
Check your credit file and score
Ask Equifax, Experian and TransUnion for copies of your file, check them all for errors and ask for them to be corrected. If you feel some notes on your file are unfair (for example, an ex-spouse or partner mounted up debts that you were unaware of), then ask for a note to be added to them.
Make sure your address is up to date and correct on all your accounts
Your address is an important piece of information, so make sure yours is correct and consistent for each one – even your TV subscription. For example, if your house has a name as well as a number, make sure it’s included on every account, as lenders will look for inconsistencies.
Break up with your ex for good
Your ex might have left you with those debts and (unfortunately) you’ll have to pay them. However, some shared accounts, like joint savers, TV subscriptions, gym memberships and similar, can be escaped. Comb through your bank statements to see if you’re still linked financially to someone who is no longer in your life and might even be a liability. Then dump them again.
Do what you can to rebuild your credit score
It takes time to build up your credit score, so ideally you need to star a few months before you plan to apply for a mortgage. A good idea is to use a credit card for small purchases and then pay the entire balance off each month, as this sends a reassuring signal to the credit agencies and lenders.
Wait for any big black marks to melt away
If you’ve got any County Court Judgements on your file that are due to be wiped, it’s worth waiting for that, even if it delays your plans. Similarly, if you made a lot of credit applications within the last 12 months, it’s best to wait until they are cleared off your file, which takes a year.
Always pay on time
Use direct debits to pay for recurring expenses and always pay the minimum credit card repayment each month. If you can, always pay a little bit more on your credit card as this will reduce your interest burden over time.
Don’t apply for any new credit agreements for a few months
Applications go on your file and if there’s a few, or if one or more is unsuccessful, lenders might worry about how you handle your finances.
Do not withdraw cash with a credit card
This is something of a danger signal and might make lenders think that you’re living beyond your means. If it’s unavoidable, for example you have emergency vet or dental fees, then ask the credit agencies to add a note to your file explaining this.