Credit score is the first thing that
lenders look into while deciding to give someone the required loan. It’s
important because creditors need to know whether or not the borrower can pay it
off easily. So, it cannot be an easy thing to borrow money with a bad credit
score. However, if you are having a good credit score you will not only get a
loan on easy terms of repayments and with lower interest rates. Another perk of
a well-maintained credit reputation, you can easily go for the suitable best
debt management plan in UK that will help you pay off your loans with
affordable monthly payments.
Before this all, you must know about
what parameters your credit score depends. There are multiple things that can
affect your credit score.
Your payment history is the key factor
that affects your credit score. This includes, but not limited to your credit
cards, utility bills, mortgages, and personal loans.
There is a common misconception that
informal debt solution agreements leave a negative impact on your credit
reputation. Actually, it is one of the things that does not affect your credit
score. Let’s see what else will not affect your credit reputation.
- Age, religion, ethnicity
- Occupation and salary
- Employment history
- Student loans
- Where you live
- Marital status
- Number of children
- Informal debt solutions
The main factors that actually contribute
to and affects an individual’s score are listed on his credit report. Remember,
a debtor with poor credit score may not be eligible to enter into an Individual
Voluntary Arrangement. So, you must consider all such things before taking a loan or
dealing with your creditors to pay off. Here’s the list of all those things that
can make or break your credit reputation.
Credit
Cards: Your credit card payment history and loans you already have on
your record.
Utility
Bills: The amount you pay every month to your water, gas, and electricity
providers.
Personal
Loans: The personal loans usually to quickly meet your financial
shortfalls will impact your score.
Mortgages: Featured
on your report, it is one of the biggest credit products with payment history
that lenders can view and make a decision of giving you the loan or not.
Mobile Phone
Contracts: Categorized as your credit deals, your phone contacts with the
telecom service provider and payments you make will be listed on your credit
record.
Car Finance:
Your
credit record will also have the information about the personal contract plan
agreement with a car manufacturer or any other financial deal for your vehicle.
Last but not the least is ‘buy now and pay
later’ credit agreements that are any kind of financial contract you enter into,
especially when it comes to store cards and that may also include repayment
schemes. So, always use your credit and store cards wisely and never get
trapped into credit products. In any such situation, you must get free
debt advice from certified financial advisors as ours at IVA Experts UK.
