| What is a credit score? | | | | have never had any credit then this can count against |
| Your credit score is an assessment of how well you | | | | you. So it could be very worth while, as long as you |
| can handle credit and from that, the bank will make a | | | | are disciplined, taking out a credit card just to build your |
| judgement as to how likely you are to actually pay | | | | credit score. |
| back the loan in full. | | | | However, if you take this drastic step use the card for |
| This is important in a few ways. For a start, a poor | | | | nothing more than regular grocery shopping, maybe |
| credit rating could totally prevent you from getting a | | | | even cutting the card in half! Although be wary that this |
| mortgage at all. Even if it does not go that far, then a | | | | too can cause problems if the bank charges you a |
| poor credit rating can still affect the amount that you | | | | fee for not using the card! |
| can borrow and increase the mortgage rate that you | | | | Check your credit report |
| will be charged when you do get a loan. | | | | Lastly, you should make sure that you check your |
| Can you improve your credit score? | | | | credit report. Request a copy of it from one of the |
| So, what can you do? Well the first thing is to | | | | main credit reference agencies and check over the |
| remember that it is calculated based on how well you | | | | report very carefully. Make sure that any loans you |
| are handling the credit that you do have. This means | | | | have had that have been paid off are recorded as |
| that if you have no credit at all or are handling it badly, | | | | being paid off. This means make sure they are there |
| then you will score badly. | | | | and that they are not shown as outstanding. |
| If you do have credit then make sure that it is all being | | | | Also check other details are correct, that loans that |
| paid off on time, every month. A borrower repaying | | | | should be there are recorded correctly and there is |
| money at the correct rate, or faster, is going to score | | | | nothing on the report that does not actually belong |
| well and look good. | | | | there. |
| A good credit score comes from having some credit | | | | Once you have done all of this you should have the |
| But there is a more important step to take and that is | | | | best credit score that you can hope for and a good |
| for those that do not have credit. Whereas normally it | | | | chance of not only getting your first mortgage, but also |
| is best to steer clear of unnecessary credit in case it is | | | | of being charged a good interest rate rather than a |
| a huge temptation to buy what you do not need, if you | | | | more expensive one. |