How to Improve Your Credit Score in the UK

Be realistic about what is possible

Credit reference agenciesCredit reference agencyA credit reference agency is a company that collects information about people's borrowing and sells it to lenders. The main UK agencies are Experian, Equifax and TransUnion.Read more → record what has happened, and negative entries such as late payments, defaultsDefaultA default is a record on your credit file showing that you have seriously fallen behind on an agreement, usually after several months of missed payments.Read more → and CCJsCounty Court Judgments (CCJs) ExplainedWhat a County Court Judgment is, how to respond to a claim, how to pay or set one aside, how long a CCJ stays on your record and how it affects credit.Read more → generally stay on your file for six years. They cannot be removed just because you pay them off or ask nicely. What you can do is stop adding to them, correct mistakes and build up a positive record that lenders can see. The effect of old problems fades as they age, and the effect of recent good behaviour grows.

Step 1: check all three reports

Start by getting your reports from Experian, Equifax and TransUnion. Our guide to checking your credit report explains how. Look for errors, accounts that are not yours and old addresses. If you find mistakes, follow the process in our guide to correcting errors, because fixing an error is often the quickest improvement available.

Step 2: register on the electoral roll

Being registered at your current address helps lenders verify who you are, and for many people it is one of the simplest ways to strengthen a file. You can register to vote online on GOV.UK in a few minutes. If you move, update your registration straight away.

Step 3: pay on time, every time

Your payment history carries the most weight.

• Set up direct debits for at least the minimum payment on every credit card, loan and bill
• Choose a date shortly after payday
• Set reminders for accounts that cannot be paid by direct debit
• Contact the lender early if you think you will miss a payment, since many have support options

Step 4: keep balances low

Using a large part of your credit limitCredit limitA credit limit is the maximum amount a lender allows you to borrow on a credit card or similar account.Read more → can make you look stretched. A common rule of thumb is to keep balances well below the limit, ideally under about 30%, though lenders do not publish thresholds. Paying down balances is helpful, and so is paying before the statement date if you can. See our guide to how credit cards work.

Avoid applying for a higher limit just to reduce your usage unless you are sure you can resist spending more.

Step 5: be careful with applications

Each application for credit leaves a hard searchHard credit searchA hard credit search is a check made by a lender when you apply for credit, which is recorded on your credit file and visible to other lenders.Read more →. Too many in a short time can lower your score, and being declined can make it harder. Before applying:

• Use an eligibility checker, which gives an indication of your chances using a soft search that lenders cannot see
• Apply only for credit you need
• Space applications out

Step 6: use credit in a controlled way

If you have little or no history, you can build one by using a product in a small, manageable way: a credit builder card with a low limit, or a credit builder loan, and paying in full or on time every month. Check the interest rates and fees, because these products can be expensive if you carry a balance. Some services allow you to add rent payments and subscriptions to your credit file.

Do not take out credit you do not need merely to improve a score.

Step 7: sort out financial associations

If you are linked to an ex-partner or another person and you no longer share accounts, you can ask the credit reference agencies to disassociate you. Close joint accounts, or ask for them to be separated, then request removal of the link. If you are in an abusive relationship and worried about credit being used against you, specialist help is available from Citizens Advice and the National Domestic Abuse Helpline.

Step 8: deal with defaults and CCJs

If you have a default or a CCJ, you will have to wait for them to age, but you can still help yourself by:

• Settling the debt or agreeing a repayment plan, so that it is marked as satisfied or settled
• Making sure the status on your report is correct
• Paying a CCJ in full within a month of the judgment to have it removed from the register (see our guide to CCJs)

What not to do

• Do not use credit repair companies that charge fees to "remove" accurate negative entries. They cannot do so legally, and anything they can do you can do for free.
• Do not take payday-type loans to build credit. Their cost outweighs any benefit.
• Do not apply to many lenders in a hurry.
• Do not pay for a credit report that you can get for free.
• Do not create a new identity or use a "credit privacy number". That is fraud.
• Do not ignore debts. Contact creditors and get advice instead.

How long does it take?

Small improvements, such as correcting errors or registering to vote, can show up within weeks. Building a positive track record takes three to six months, and recovering from significant negative events takes longer, with the greatest effect when they pass the six-year mark. Check your reports regularly to see how things are changing.

When your problem is debt, not your score

If you are struggling to meet payments, the priority is dealing with the debt, not improving your score. Free debt advice can help you with options. Some solutions, such as debt management plans or IVAs, will be recorded on your credit file, but they can give you a path out of debt. See debt management plans for details.