|
Modern life depends on our ability to borrow - but what we think contributes to that crucial credit rating and what actually matters are two very different things.
|
With personal debt in the UK hitting an all-time high of £1.3 trillion, it's more important than ever to understand the factors that affect our ability to borrow - and how to manage credit sensibly.
Unfortunately, half of us don't fully understand what a credit rating is and how it affects our ability to borrow. A third of us have been refused a loan at some point and 40 per cent of this group don't know why.
|  |  |
This simple guide separates credit fact from fiction, so you know what really matters to lenders - and what you don't need to worry about. read more ...
Myth 1: Previous occupants at my home affect my credit rating
Pub bores often put this nonsense about and 71 per cent of you believe it - but it's completely untrue. The previous occupant of your house or flat could have been a millionaire or a bankrupt but that makes no difference to lenders at all.
read more ...
Myth 2: Family and friends living at my address could harm my credit rating
 |
|
Until a few years ago, lenders checked the credit reports of others living at your address. They could then take their position into account when deciding whether to offer you credit - and according to a survey by CreditExpert 63 per cent of people think that's still the case. read more ... |
Myth 3: Credit reference agencies decide your credit rating
No, they don't - but 53 per cent of people think they do and also make the decision whether or not to lend to you.
read more ...
Myth 4: Your credit rating is poor because you're on a blacklist
There's no such thing as a credit blacklist, even though 41 per cent of people blame this if they're refused credit.
read more ...
Myth 5: You have only one credit rating
You can have many different credit ratings, depending on who you apply to, what you apply for and your circumstances at the time you apply. Still, 29 per cent of people think that they have a single score that applies to every type of credit, from a store card to a mortgage. read more ...
Myth 6: Past debts don't count
Unfortunately, they do, even if you're financially fit today. In this area, most people are pretty realistic - just 12 per cent of us believe that an old debt doesn't matter.
|
|
|
Typical 14.9%
