What does 'Credit Rating' mean?
Credit Rating
Every person has a credit rating which is a numerical score of how good they are at handling debt. It is based on how well a person has kept up to date paying back loans or honouring certain agreements (such as monthly payments on a mobile 'phone). Outside of this being on the electoral register also helps improve a credit rating.
Those who have rented or avoided debt often have poor ratings due to a lack of historical data.
You can access your credit rating via a number of agencies to check there are no errors on it and to ensure the details are up to date.
Search Results for 'credit rating' in How to Really Buy a Property
Chapter 11:
Sorting Out Your Mortgage
"...Recently applied for credit - Every time you apply for credit your credit rating takes a hit, even if you ultimately don't take out the loan. The classic case is with store cards and goes a little like this. Mr X is out on a shopping spree and in several shops he is offered a discount on his purchases if he applies and pays for his purchase with the store's credit card. He has the money in the bank but he could make substantial savings so he takes the cards and pays them off within the month. But each card has represented an application for credit and so hit his rating. It will recover but if he applies for a mortgage in the near future he may be turned down as the lender is suspicous about the amount of credit he has been taking out.
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Chapter 13:
Your Own Homework
"...If your property purchase is going to involve borrowing money it is worth checking your current credit ratings. Many people who have lead a prudent life are often surprised to find they have a very poor rating. Others are also taken aback when a mortgage is rejected because of some event in the past that has long been cleared up but the settlement was never properly passed on to the credit rating agency.
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Search Results for 'credit rating' in Property FAQ
Search Results for 'credit rating' in Property Terminology