FAQs
Credit checking is a
subject that provokes questions. Here are some.
Am
I a good credit risk?
You may be a good
credit risk or a bad credit risk, but ultimately only
you know for sure because of your financial
circumstances. The question of course is how the credit
agencies view you. Their assessment will be based on
algorithms, that is to say, complex score cards or
scoring models that take a statistical view of the
information on your credit file.
What is
a credit reference agency?
Credit reference
agency or credit agency or credit checking agency are
names used to describe companies that hold and gather
information that provides clues as to the credit
standing of private individuals. The agency may glean
information from a wide range of sources, such as
finance companies, store cards, phone operators, banks
and others. They also use the Voters Roll as
a means to track where people live. The credit
agency then provides credit check reports to
lenders wanting to credit check consumers before
deciding whether
to extend credit.
Will
my job and salary be revealed?
A credit report does not normally
include this type of information. If the lender knows
this data then the chances are that this is information
you yourself have provided at some point, for example by
completing an application for, which asked for your
employment details and income.
Are other people on
my credit report?
The credit report should not show information relating to people with
whom you have no financial connection. For example, people who have previously lived at your
address should not influence your credit report. Only information relevant to
you and your financial circumstances should appear on your credit files.
Is my postcode bad?
Post codes
are not used to determine your credit risk. Although
lenders may use postcode and socio-demographic data
and profiling, this is probably of more interest to
them from a marketing perspective. If you live in a
street where lots of other people are wealthy, or lots
of other people default on their credit, this does not
change your credit score. What matters is the
information on your credit file, and how the lenders
interpret what they see.
What is a credit
score?
A credit
score is a mathematical routine that allows lenders to
apply non-bias and objective assessments to the
thousands of credit applications they need to approve or
decline, or refer. This may mean that specific
circumstances get overlooked, but in the first instance,
it enables lenders to be objective in their assessments.
A score may provide a guideline to the lender, but they
may of course amend their decision based on other
information you have provided.
I have been declined credit can I do anything ?
You need to contact the company
that made the decision. The credit agency cannot tell
you why the lender decided against extending credit. You
need to ask the lender. If the lender used a credit
agency to run a credit check on you, then the lender
must tell you the name of the agency. You can then check
your credit report and make sure that there is nothing
incorrect or which unfairly counts against
you.
More FAQs?
See more Credit
Report FAQs here. |
