Thursday, 16 July 2009

What to do if you are refused credit

posted by debts.org at 03:26

Don´t panic take action

Always remember that credit is never handed out to everyone. You need to show lenders that you can afford to make your repayments on time every time. By doing this you are much more likely to get the credit deals you want. If you are among the many people who have been refused credit, don´t panic but take action.

Your credit report

Your credit report lists your borrowings and shows how well you are managing repayments. It shows your credit history, what credit accounts you have had in the past few years, and how you have managed financially with credit repayments. Order an annual credit report to make sure all details shown on it are up to date, as lenders will check your credit report before they decide whether to give you more credit or not.

Top credit report tips include:

• Take responsibility for your own money. Pay your bills on time and make repayments on cards, loans and mortgage repayments on time. You will end up owing more if you miss payments, plus have to pay penalties which will damage your credit rating.

• Check your credit report regularly so you can monitor your progress. Make sure every entry is correct as one single error on your credit report could result in refusal of credit.

• Contact your lenders immediately if you are worried about repayments. The sooner you contact them the more likely they are to work out a schedule of repayments that you can afford, or even arrange a temporary payment ´holiday´.

• Sit down, go through your debts or outgoings and income, and organise a budget which you can stick to. Price comparison sites can find you better deals on utilities, as well as mortgages and credit card interest rates. The Financial Services Authority financial healthcheck could help you at www.moneymadeclear.fsa.gov.uk.

• Never try to borrow more credit to get you out of trouble. Face the debts you have head on and you will find a way out. If you rack up more debts, you could be rejected for credit when you really need it in the future, as this will show up on your credit report.

• Look into debt consolidation where you can roll up several debts into one, single loan. You will find several financial comparison sites on the internet with financial and mortgage calculators to help you.

• Look for ways to supplement your income. Perhaps you could take in a lodger, or sell off unwanted clothes or furniture at the market or on e-bay. You may also consider a part time job in the evenings or at weekends.

• Remember that if you have a partner with financial problems, his details will be linked to yours on a credit report. A lender´s response to your application can be affected if you have a financial association, as your partner´s credit report will be assessed too. If you are linked to an ex, who no longer lives with you, tell your lender as soon as possible so this can be removed from your credit report.

• If you are struggling to cope with your debts, contact a specialist debt management company such as debts.org who can walk you through the debts management minefield, and help to achieve a debt-free future for you and your family. You can also get free advice from the Citizen´s Advice Bureau at www.citizensadvice.org.uk, from the Consumer Credit Counselling Service at www.cccs.co.uk or National Debtline at www.nationaldebtline.co.uk

Check your Experian credit report online with a free trial of CreditExpert, the UK´s leading online credit monitoring and ID fraud protection service.

Labels: ID fraud, manage debts, partner, report