As a mortgage broker based in Southend the word ‘failed credit score’ is a minefield to us AND we deal with lenders everyday so goodness how you feel when you get told you failed credit score knowing full well you have a great score on your credit file… let me try and shed some light on this for you!
When you apply for credit, lenders look at your credit score to work out if you’ll be able to repay what you owe. Each lender scores you differently having their own points system between their data and your credit file.
Having no credit at all can go against you as the lender is unable to see the likelihood of you paying money back, it’s useful as first time buyers or those that have no credit to invest in a credit card NOT to get into debt but maybe put your petrol on and clear monthly just so there is some trail of you being lent money and you paying it back.
Being on the Voters roll is a big tick as well when it comes to earning a point from a lender – so check wherever you lay your hat you’re registered at that address.
Be aware if you are searching the comparisons sites for a personal loan, car insurance, house insurance, home insurance whatever it maybe BE CAREFUL as they also leave a footprint albeit ‘soft’ until you have chosen your provider when it turns into a hard footprint!
Every time you apply for credit it adds a footprint to your file for a year. Too many, especially in a short space of time, can trigger rejections as it makes it look like you’re desperate for credit.
Having a failed credit score doesn’t mean you have bad credit , it means you purely haven’t passed the lenders points system, they will never confirm specifics so it is a guessing game but if you keep the above in mind it may help.
When it comes to a mortgage the higher the loan to value i.e. 95% you must pass a higher score as you are classed as a higher risk to the lender. There are a few lenders out there that do not credit score, but you do pay a slightly higher rate.
The above is just something to make you aware of if you are looking to get a mortgage soon, maybe hold fire on the comparison sites, credit score is a bit of a gamble and you never know until you try with these lenders but hopefully the above helps and makes it a bit clearer.
Kelly Worthington,
Senior Mortgage Advisor
