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Many people have poor credit ratings due to error or previous mistakes which can affect ones ability to borrow through the major banks. The only sure fire way of finding out if such data stored on your credit record is the reason why you have been refused credit is by gaining access on one of the major credit bureaus – Equifax or Experian. For a small fee, you will then be able to see exactly what is preventing you from being accepted for a loan.

It is worth knowing that any bad credit information held on your file including both defaults and CCJ's will be stored on your personal file for six years, even if you have paid the outstanding debts off. This is why during the six years after any default you may be turned down for credit.

If you are having trouble getting credit and don't know of a reason it is worth checking out the information held about you. Should your history contain any erroneous information, you should send a ‘statement of correction' to the agency – and also investigate the other agencies. All lenders forthwith will see your statement and may take this into consideration when considering you for credit.

There are several factors a lender looks at when deciding whether to give you credit or not. These include age, income, and your current debt obligations.

Lenders can also look at family history – for example, it is important if you are estranged from any family members to ask the credit agencies for separate files, so other people's history does not affect your status.

However, your payment history is the main area of your credit history that lenders care about - it accounts for 35% of your personal rating at any one time.

One of the best ways to ensure an improved credit rating is actually to borrow more – as long as you demonstrate that you are able to pay your debt off quickly, the better your rating will become over time.

You might think that closing old bank or credit card accounts with no outstanding payments will simplify your life – however, doing so actively shuts the door on that credit knowledge. In other words, your credit file will not acknowledge cards paid off in full if you close the account.

While interest rate may be considerably higher, in the event that your are unable to get a loan from one of the mainstream lenders, there are other reputable lenders on the market that will still provide your with credit, which can it turn help you to demonstrate that your are able to fulfil your obligations in the long term.

Article Source: http://depositarticles.com/

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