Credit profile dos and don'ts

One of the most important things that people forget to consider when obtaining a mortgage is what’s on their credit profile.

Your credit profile will help mortgage lenders decide whether to lend to you as well as how much they will let you borrow. It’s also a way for lenders to establish whether you will be a risk to them or not.

Below is our credit profile dos and don’ts which could help you improve your chances of obtaining a mortgage;

Do

  • Register on the electoral roll.
  • Ensure that you maintain the repayments on your credit commitments.
  • Reduce the amount of debt that you owe.
  • Close down old accounts, you may not use the account but the lender will still look at the amount of available credit you have.

Don’t

  • Open a lot of new credit accounts at the same time, or immediately before applying for a new mortgage.
  • Miss payments as these could be highlighted on your credit report! ALWAYS ensure you make the minimum payment on your credit agreement, overpaying if you can.
  • Overspend on your available credit.

Monitor your credit rating

Your credit file lists your past credit cards, loans, overdrafts, mortgages and some utility accounts, for accounts that were open over the past six years.

Many lenders use the following credit agencies although others are available:

Equifax
Experian
TransUnion

You can sign up for a free trial with Experian and Equifax, but they may charge after a set period of time.

There are also free to use websites such as Clearscore which does not charge you to view your credit profile.

But don’t be too hung up on your score, it's more the makeup of your profile that counts.

To find out more or to discuss the options available for your circumstances, why not get in touch with one of our friendly advisors.

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