Help Guide: Finance & Insurance
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A simple guide to Credit Checks

In today’s day and age it pays to be fully informed as to your credit history. This is not only vital if you’re to successfully apply for certain financial products (such as a mortgage, loan or credit card) but is additionally important for ensuring that you’ve not been a victim of identity theft. This guide then talks you through how you can get and read your credit report and what other considerations you should have when using a company for your credit report needs.

What are credit reports?
Credit reports are a detailed history of your credit accounts, such as previous loans, credit cards, bank accounts and any other product where you’ve been provided with credit (such as hire purchase one television).
In the report the performance of each account will be detailed, including any amounts owed, whether your repayments were on time and when the account was opened.

The more sophisticated of credit reports will provide an overall ‘score’ which will provide a good idea as to how credit worthy you are.
The defining difference between credit reports and how businesses credit score you
Whilst a credit report company will provide you with your credit history and possibly an overall score it’s important to understand that this does not dictate how various companies will weight up your credit worthiness. For example, some companies may place more emphasis on how many accounts a person has opened and left dormant, whilst another may consider one late payment as a reason not to provide a product at all.

That said, the rules as to what is favourable and unfavourable one credit report are generally the same. With late payments, defaulted accounts and County Court Judgements all having a negative impact upon your credit history.

Getting your free credit check
Getting a free credit check is as easy as using a website to enter your details and verify your identity. In some instances this is a straight forward process and your credit report is available immediately. In other instances however the company in question may need to verify your identity through sending a code to the home address that you’ve specified (this will certainly be the case if you’ve recently moved).

Other considerations when gaining a credit check report
Avoiding ongoing monthly costs
The majority of credit check companies offer a free report, however this is only for a limited time (usually 30 days or less), after which you’ll be charged. Many people forget about this aspect once they’ve received their initial report, leading to ongoing monthly charges that are simply forgotten about. Whilst this charge may be less than £10, it can and will amount to a lot over a number of months if not cancelled. To this end you should always be sure to cancel any ongoing payments by contacting the company directly.