If you find that a finance company refuses you credit it’s almost certainly because of a poor credit score. Yet despite this 49% of UK adults* have never attempted to access their credit reports and have no idea about what their credit score might be or how to improve it.

The good news is that it’s not difficult to understand how credit reports work and it’s possible to access a free report in a matter of minutes. So what are the key things to understand?

Firstly there is no such thing as a ’universal credit score’. The big three credit rating agencies in the UK (Experian, Equifax and Trans Union) all have a different scoring system. That said, all three gather information about your credit history in the form of a credit report and use similar criteria when scoring that history.

What doesn’t affect your score

Contrary to popular belief there is also no such thing as a UK wide ‘credit blacklist’ that affects your score, nor does living at the same address as a family member with a poor credit score (unless you have joint financial products), or at the same address as a previous occupant with a poor credit history. You also don’t need to worry about old debts including CCJ’s that are over six years old as these don’t impact on your credit history and checking your own credit report will likewise have no adverse affect. Finally, unpaid student loans or criminal offences will not affect your score.

How to improve your score

The easiest way to improve your score is to make sure you are on the electoral register as this helps the credit agencies confirm your personal details. Then it’s vitally important to make sure all your existing credit repayments are made on time, as any missed or late payments will affect your credit rating for up to six years. In particular, debts that result in CCJ’s will appear as a red flag on your credit file and if you do have any they should be paid off as soon as possible. The Credit agencies also don’t like to see evidence that your finances are under pressure. So try avoid going over your agreed bank overdraft limit or maxing out credit cards or other available forms of credit. Try also to avoid making multiple applications for new credit products at the same time, as this is something else that can adversely affect your credit rating.

Another good reason to check your credit report is that the credit agencies sometimes make errors that adversely affect your score (you should be able to appeal against these). And although it may seem a bit unfair, if you haven’t had chance to build up a credit record this will also impact on your credit file and your ability to obtain credit. Your only option may then be to talk to a not-for-profit lender such as Transave who may be more sympathetic to your predicament than the high street banks and building societies. Other lenders also offer ‘Credit Builder’ cards that will allow you to start building up that all important credit profile.

How to access a free credit report

There are a number of websites where you can access your credit reports in minutes entirely free of charge including Totally Money https://www.totallymoney.com , Credit Karma https://www.creditkarma.co.uk/ and the Money Saving Expert Credit Club https://www.moneysavingexpert.com/creditclub/

* Experian Survey 2019