5 tips to spring clean your credit report

Feel like your credit report could be holding you back? Now is a great time to check it, see what’s in there and give it a springtime spruce up to make sure it shows you in the best possible light.

Here are our five top tips to help you tidy up your credit report and improve your score.

1. Dust off your credit report

If you haven’t checked your credit report lately, then this is a good place to start your credit score spring cleaning. After all, it’s the information within your credit report that’s used to calculate your credit score, so it’s important that everything is correct and up to date!

When you check your credit report, keep an eye out for these things:

• out of date information – like an account still registered to an old address, or showing as open when it should be closed
• mistakes in your payment history – has a company recorded that you’ve missed a payment when you haven’t?
• missing information – such as accounts that aren’t included in your credit report
• information you don’t recognise – for example, accounts opened or applications made in your name that weren’t you

Make sure you update any old information with your account providers, and speak to them about any mistakes, missing information or details you don’t recognise, too.

You can also query any mistakes or issues in your credit report with the credit reference agency you get your report from.  Even if they can’t remove or change the information, they may be able to help you add a ‘notice of correction’ to your report that explains what happened and tells your side of the story.

2. Are you on the electoral roll?

Registering to vote is a quick and simple way to spruce up your credit report and boost your credit score. Not only is being on the electoral roll a legal requirement if you’re eligible to vote in the UK (you don’t have to vote if you don’t want to, though), it’s also information lenders like to see in your credit report. When you apply for credit, lenders need a way to confirm your identity and address. Being able to use the electoral roll information they find in your credit report usually makes this much easier for them, so being registered to vote is a big tick in their eyes.

Even if you’ve registered to vote before, it’s worth making sure the details included in your credit report are correct and up to date. You will need to register again each time you move house - even if you’re not moving out of your local area - as well as if you change your name, for example after getting married.

Whether you’re registering to vote for the first time or re-registering under a new name or address, it only takes a few minutes to provide your details online. Then, your local electoral registration office (usually your local council) will do the rest, and the information should appear in your credit report 6-8 weeks later.

3. Declutter your debts

Money you owe to a lender, from mortgages to overdrafts and everything in-between, will normally appear in your credit report. Lenders look at this because it’s important that they make sure you’ll be able to repay what you borrow from them, alongside your existing commitments. If you have high outstanding balances, then lenders may worry that you won’t be able to afford to continue making those payments as well as a new one to them.

A useful general rule of thumb is to aim to owe 30% or less of what you could borrow according to your total credit limits at any time. If you have accounts with a higher balance than this, then anything you can do to trim them down or pay them off completely will help show lenders that you can afford all your commitments and don’t rely on credit to make ends meet.

4. Clear out old connections

If you’ve ever shared a financial product with someone else – like a joint bank account, mortgage, credit card, or even both being named on your household bills – then that person’s name will likely crop up on your credit report as someone you’re financially linked to. Sometimes, you’ll see them called financial associates rather than connections, but it means the same thing.

If you have financial connections, then lenders may take their credit history into account as well as yours when deciding whether to approve you for credit, whether or not you’re applying jointly with your connection.

When they check your financial connection’s credit history, lenders are looking at whether how they manage their finances could impact your ability to repay what you owe. For example, if your financial connection has a history of not making their payments on time, then lenders may wonder if you ever cover their share of your joint commitments, or chip in towards their individual obligations, and if this means you’re less able to afford new borrowing.

On the other hand, if your financial associate has a good credit history, then your connection to them will have no negative impact on you whatsoever. Their good behaviour won’t make you more likely to be approved for credit, though.

Unfortunately, you can’t remove a financial connection from your credit report simply because you think they could be holding you back from getting the credit you want. However, if your report includes the names of old financial connections and the accounts you shared with them are now closed, you can request their name be removed from your report by asking your credit reference agency.

5. Got a credit card gathering dust?

Got an old credit card that no longer sees the light of day? Or maybe a store card you haven’t used since you opened the account?

Whether you use them or not, these accounts will still be included in your credit report and count towards your total credit limit. And having a large amount of credit available to you through big credit limits can be a bit of a double-edged sword.

On one hand, having high credit limits shows you can be trusted to borrow large amounts of money. But on the other, especially if you’re not touching some of the cards and accounts that are included in your credit report, it could be putting lenders off. Why? Because even if you’re not using all the credit available to you right now, you could decide to spend the lot at any moment. If you did this, lenders may worry you’d struggle to pay all of that, plus what you owe to them, back.

Closing any accounts you don’t use will reduce your overall credit limit, but also gives lenders a more reassuring sense of your credit use. Together, this could boost your eligibility for a new product.

So, to sum up, here’s our tick-list to improve your credit report:

1. Check your credit report and fix any issues
2. Register to vote
3. Reduce and pay off your debts
4. Remove old financial connections
5. Close unused accounts

Looking for more ways to improve your credit score this spring? Try these 45 ways to give your score a boost!