Whether you’re applying for a loan, mortgage, or credit card, or simply getting your finances in order, a credit report is essential. It helps you know where you stand financially and shows how lenders see you. The laws around credit reports recently changed, meaning you no longer have to pay high fees to view your file. However, many people don’t know how to get their free credit report in the UK.
In this article, we look at all the vital information you need to know about credit scores and reports. This involves defining what they are and what’s included in them, who will look at your credit score, and why it’s so important that you check it. We’ll also outline how you can check your free credit report, giving detailed steps for each agency.
What is a Credit Report?
Your credit report is a file that shows details of your financial situation. It outlines your personal information, as well as your borrowing history, loan repayments, amount of credit, and other details. It gives an overall indication of your suitability as a borrower, often with a score or rating. The higher this score is, the more likely you are to be approved for a loan, credit card, or mortgage.
There are three main credit reference agencies in the UK. These companies each have their own system of compiling reports. As a result, there is no universal credit score. Different lenders will use different credit reference agencies, as well as their own metrics, to assess applications for credit.
You will often see lenders and comparison websites use the terms credit score or credit rating. Often, these refer to the same numerical representation of your finances. To have a high score or rating, you need to have demonstrated your past financial responsibility. This usually means you have had credit and repaid it in full and on time.
Your credit report goes into more detail than your credit score, which is just an overview. If your rating is poor and your file shows unpaid loans, late payments, or other irregularities, you will find it hard to be approved for credit. It can also mean your interest rates are higher.
What Information is in a Credit Report?
Information is collected from a variety of sources and compiled into one central document. Most of it is related to your past finances, so banks, building societies, credit card companies, and other lenders. There are also personal details such as your previous addresses, info from utility companies, and the electoral register.
We’ve outlined some of the information that will be included:
Information on your current loans, credit cards, and other forms of credit.
Whether you’ve missed any payments or been late in repaying credit accounts.
Whether you’ve previously been declared bankrupt or had your home repossessed.
Your personal details including name, date of birth, and address history.
Whether you are registered on the local electoral roll.
Whether you have any judgements made against you at a County Court.
Recent applications for credit.
This is a fairly comprehensive list, and it gives lenders the opportunity to see how you’ve managed credit in the past. You may find it to be a little intrusive, but rest assured there is plenty of information that’s not included. Some examples of this are:
Your current savings or current account balance.
The salary at your current job.
Details of any student loans.
Whether your council tax is in arrears.
Whether you have a criminal record.
By knowing what is and isn’t included in your credit score and report, you can assess what will impact your ability to access credit.
Who Looks at My Credit Score?
Whenever you apply for a loan, credit card, or other types of credit, your score and report will be looked at. Additionally, when you’re applying for a job, house rental, or mobile phone company, it may also be examined. We’ve given specific examples, below:
Opening a new bank account
The bank may review your credit history in order to determine whether you are eligible for an overdraft.
Applying for a credit card
The interest rate, credit limit, and type of card you’re suitable for will depend on your credit report. If you have a good history and score, you’re more likely to get preferential rates.
Applying for a mortgage
The lender will definitely look at your credit report when you’re buying a house. Their final decision will be based on your current situation and your record as a borrower.
Opening a utilities account
Utility companies will check your score to determine what kind of tariff they place you on. If you have a poor record, you may have to pay in advance for your bills.
With such a wide range of information available about your personal details, you may be concerned about its safety. However, the credit reference agencies will only release the data to authorised companies. They take your security seriously, and with new GDPR laws, you have greater control over the information they hold.
Why Do I Need a Free Credit Report?
As you’ve seen above, your credit report gives a lot of details about your financial situation. Even if you’re feeling positive about your circumstances, it’s always a good idea to see how lenders view you.
When you’re applying for a loan, mortgage, or credit card, it’s useful to know whether you’re likely to be approved. A failed application for credit can be damaging, as it indicates lenders don’t view you as a viable borrower.
If you’ve had bad credit in the past, it can take time to rebuild your reputation. Accessing your credit report gives you the chance to see where you can make improvements. You can make a variety of changes to improve your financial standing, making it easier to apply for credit in the future.
How to Get a Free Credit Report
Now that we know why it’s so important to check your credit report and what it’s used for, it’s time to outline how you need to do it. In the UK, GDPR laws mean you have the right to access information that companies have on you. This means that you can access your credit score for free. We’ve summarised the steps for each credit reference agency, below:
If you want to check your credit file and score across all of the major agencies, CheckMyFile gives a 30-day free trial of their service. It allows you to compare your scores and details across multiple sources, and also allows you to customise what elements you see. It costs £14.99 per month after your free trial ends.
There are two main ways you can access a free credit report with Equifax. The first is to sign up directly with the Equifax website. They offer a 30-day free trial where you access your file an unlimited amount of times. With their alerts service, you’ll also be informed of any changes in your score. The only downside is that it costs £7.95 per month to use the service after the free trial.
The alternative way is to sign up with ClearScore. Their free service gives you a monthly report of your credit score and file. It’s easy to subscribe, and you’ll never have to pay a fee. The one downside is that they often try and push particular financial services at you.
As with Equifax, there are two ways that you can check your Experian credit report. They have their own service, called Credit Expert. This allows users to sign up and create an account to manage their credit report. Experian offer a free 30-day trial for this service, which means you have unlimited access during that time. However, after your free month, you’ll have to pay £14.99 per month.
Thankfully, there is a totally free way to access your Experian credit report. You will first need to create an account with the Money Saving Expert Credit Club. From here you can view your credit score, as well as receive advice about how to improve your rating. As with ClearScore, it’s free forever. The one downside is that you can only obtain a monthly snapshot of your file.
TransUnion used to be called Callcredit. They’re the smallest of the credit reference agencies but are still widely used. They offer a free service called Noddle which gives you access to your credit report and score. It’s free for life, and the sign-up process is straightforward. They do try to push their ‘premium’ service on you, but this isn’t necessary in order to check your file.