About Your Credit Rating

Last Updated: 21st Oct 2016
About Your Credit Rating

24th September 2014

Credit can be a confusing matter, especially for those looking to get their first finance agreement or people who have never really understood the importance of playing the credit game until they are refused credit for one reason or another.

Bad credit isn't necessarily accumulated because of bad borrowing or being blacklisted and can in fact be just because you've got to a certain age and haven’t lent any money in the past. The myth is that if you haven’t borrowed anything, you haven’t failed to make any repayments and therefore you must have good credit.

Unfortunately this isn't always the case as having little to no credit history makes it difficult for lender to assess whether you are likely to repay or not. This may lead you to have to avoid the market leaders in credit cards and finance offers and opt for a more lenient credit lender.

There is also the other side of credit and those who have failed to make payments, whether it been accidental or unavoidable. This can certainly damage credit files and means that many mainstream lenders will avoid assisting with car finance or leasing as they are deemed more risky.

This is where bad credit car leasing can come in handy. In return for slightly higher monthly payments you have a chance to get into a newer vehicle and help rebuild your credit. Once the term has then ended or come towards the suggested time to switch then you can reapply for a prime lender and reduce monthly payments again.

If you’re refused prime credit there are different ways to rebuild your credit providing you’re committed to making the future repayments as well as opting for poor credit sub prime car leasing.

An accommodation deal is an option to reduce the monthly repayments on a car lease. The basics involve someone close to you, either a family member or partner who is willing to put the credit in their name. It’s like a guarantor but involves more responsibility and someone who is willing to put the agreement in their name must have good credit. The direct debits can still come out of your bank account but missed payments will leave the accommodator with poor credit, also.

You can try dedicated credit cards which have a higher acceptance rate for poor credit customers but on the flip side, you will have more expensive interest charges. If you keep on top of repayments though, you’re unlikely to be too badly affected.

When a bad credit credit card isn’t an option due to them refusing you, then Money Saving Expert suggests that you can opt for a CashPlus card and sign up for the Credit Builder option. This will count the £4.95 fee as a monthly loan repaying the £59.40 a year fee, interest free. As you make the small monthly repayments your credit file will be updated with the likes of Experian.

Another important part of your credit is whether or not you are on the electoral roll. It’s incredibly simple to register yourself with your local council’s electoral roll and can be completed in under five minutes. It may seem a completely odd correlation between the electoral roll and being able to get car leasing or finance but lenders use it to check address history so it is a vital part of the credit process. If you know you’re not on the electoral register you can find out more information at Gov.uk.

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