Four Factors Affecting Your Credit Score, And How To Fix Them!

Your credit score affects many of the financial aspects of your life, including applications for payday loans, mortgages, and even for rented housing. Therefore it is important for you to have the best credit score you can. However, sometimes there are factors that can negatively affect your score. Luckily, some of these factors can be easily rectified to put you in the best financial position!

Not sure what’s actually in a credit file? Learn more here!

Credit score reports typically contain a lot of information, including your name, address, current employment, credit history and more. You can easily check your credit score and credit file for free on Experian, so if you’re thinking of applying for credit in the near future, you should check your credit file first to make sure there are no errors present.


Any mistakes in your credit application or mistakes in your credit file can have a seriously negative effect on your credit score. Credit companies are much more likely to reject an application that has present mistakes.

There are several common mistakes made on credit files that should be fixed as soon as possible:

Mistyped or wrong National Insurance Number — Your National Insurance Number is linked to your identity from the moment you’re eligible to start working. Numbers are often quite similar, which means that a mistype could mean that your employment history comes up as someone else’s. You may be in a full-time job, but someone with a similar NI Number could be unemployed.

Repayment history — If you’ve had loans or credit cards in the past, you will have had to make consistence repayments. These repayments appear in your credit file so that when you apply for credit again, the financial lender can see that you are a responsible person who makes their repayments on time. In regard to this section, in particular, we’d like to offer some advice: If you’re applying for new credit, ensure that the new lender reports your repayment history to help you build your credit. 

Incorrect address — We briefly mentioned this above, but an incorrect address can lead to credit accounts being merged or a lender finding the wrong account for you. Some financial lenders base their rates on where you live, which means an incorrect address could make your credit rates quite high.

Incorrect name — Like having an incorrect address, an incorrect name can also cause confusion, and your credit file may pick up the history of a person who has a similar name.

To fix these errors, you need to dispute your credit file. You can do this by contacting the company that you receive your credit report from. Only that company will be able to fix the mistake in your credit file, but they may need to contact your previous lenders or see proof from you that the details are wrong. For instance, if your address is incorrect, you’ll need to provide proof of address.

By rectifying these mistakes, you should see your credit score improve. Having a good credit score can increase the likelihood of securing loans in the future. But, if you’re still working on your credit score there are lenders who can also help secure a loan for poor credit borrowers.

How To Check If You Have A Credit Footprint

When taking out large amounts of credit, such as a mortgage, it’s not just necessary to have a good credit file, it’s also important to show that you have a credit footprint. Having no credit on your credit file can be as bad as having poor credit. This is because lenders have no way of knowing how you handle money if there is no evidence of this on your credit file. So how do you make sure you have made marks on your credit file?

What is a Credit Footprint?

A credit footprint is a mark or record to show that a lender or a creditor has searched your credit file. For example, applying for a short term loan would leave a footprint. A soft credit search to assess limited information on your credit score will not leave a footprint, but a hard credit search to check a complete file leave a footprint.

If a company sees that you have recently recorded lots of credit footprints with loan lenders, it could imply that you are in financial difficulty. For many lenders, too many recent footprints left by short term loan lenders could negatively affect your application.

It’s easy to check the shape of your credit file for free at Experian.

credit cards

How To Create A Credit Footprint

Taking Out Credit

It may sound a little odd, but you need to take out credit to get other credit. This shows that you are capable of repaying the amount borrowed from another lender. Credit cards are a good example of this – making regular payments towards this and paying on time show you are a responsible borrower. If you aren’t using your credit card though, some companies will mark the card inactive, or even close down the account. This can affect your credit file as things like the credit limit you have compared to the credit you used are considered.

Sending Regular Payments

Setting up something as simple as a Direct Debit to pay your phone bill can help boost your credit file. This shows that you aren’t concerned that the funds won’t be there and that they can be collected automatically each month. Therefore it’s a good idea to set these Direct Debits up the day after payday, to make sure you have the funds!

Finance Options

This can be a little more risky, as you could have a large amount of credit attached to your credit file that doesn’t go down for months, when you need to make payments. But getting something like a car on finance can work like taking out credit, in that it shows you are able to pay back things on time.


All Sorted

Once you have repayments on your credit file, you can show lenders that you are able to handle your finances and pay back on time. So if you are looking for large amounts of credit, from mortgages to bank loans, just make sure that you have good credit on your credit file, rather than no credit at all. 

Debt Consolidation — Find Out Whether This Could Be The Right Option For You

Taking out a short term loan can often be an excellent way to cover an unexpected cost. However, taking out several loans alongside other borrowings can become difficult to repay. One solution for you if you are struggling to keep up with the monthly repayments is debt consolidation. Here, we explain what debt consolidation is and whether it could be a good solution for you.

Understanding Debt Consolidation

Debt consolidation and debt management are two different things, so don’t get them confused! Both are intended to help manage your monthly payments, but it’s all about deciding which option will be right for you.

Debt Consolidation merges all of your debts together into one single debt that covers them all. This can make repaying your debts much easier because it means you only have to make one single payment every month.

This consolidated loan could repay outstanding debts on credit cards, personal loans or store cards.

UK Debt

Make sure if you do choose to opt for a debt consolidation that you know if the loan is unsecured or not. An unsecured loan means that you lent the money based on whether they believe you are likely to repay, which is based on your credit history. A secured loan is secured against a valuable asset such as your house, which means your home could be repossessed if you fall behind on your payments.

It’s important to note that if you do choose to consolidate your debts you should not take out any other loans or credit and you should destroy your credit cards until you have got your finances back on track. 

Advantages to Debt Consolidation

All of your outstanding credit is in one place — It makes repayment simpler as you only have one interest rate and one single repayment.

It could improve your credit score — Once your debt is consolidated and you are able to manage your monthly payments, you may see your credit score improve. This is because lenders and banks can see that you’re able to keep up with payments and are therefore more trustworthy to borrow money.

Disadvantages To Debt Consolidation

You could end up paying back more —Consolidating your debts and repaying over a longer period of time could see you paying back than if you pay them back separately.

Higher interest rates — If you move your credit card repayments to a consolidation loan, you may end up with higher interest rates. A way to avoid these is to do a balance transfer on a 0% introductory rate.

Early repayment fees — Unlike PiggyBank, many lenders charge a fee to fully repay a loan before the end of its term. Check the terms and conditions to make sure you know whether these fees apply.

Is Debt Consolidation Right For You?

Take our quiz!

What Exactly Is A Credit File, And How Does it Affect You?

You may have heard before that your credit file is important and that “you should really check your credit score more often”, but why? What makes your credit score so important, and how does it affect you? We’ll lay it all out for you.

piggy credit

What is a credit File?

A credit file is made up of all of the credit that you’ve taken out in the last six years. This includes information supplied by banks, building societies and even payday loan direct lenders such as ourselves. It demonstrates whether you’ve paid back your debts on time so that other creditors can decide how risky it is to lend you money.

Everyone has their own individual file, and you can check yours for free at Experian.

What Information Does It Have On it?

A lot of information is held on your credit file: such as your name, date of birth, and current and previous addresses. It also holds information from bank accounts in your name and any loans you’ve agreed to.

This includes:

  • Any past missed payments: this could be an unpaid balance on your credit card, missed rent, or failure to pay a monthly bill
  • Defaulted accounts
  • Any current debts – including credit card balances, payday loans and phone bills.
  • Court Judgements against you
  • If you’ve been made bankrupt or insolvent
  • If you’re on the electoral roll

How Does It Affect You?

By using the above information you are given a credit score. The higher your credit score, the better. Think of a credit score like a test: the more marks you get, the better your chances are of getting what you want. When you have a good credit score, it means judging by your credit history, you have a high probability that you will repay the loan within the stipulated time.

Therefore, if you intend to get a loan at some point, especially from institutions like banks, you need to work towards having a good credit score. A good credit score is, therefore, something that will make lenders trust you that much more.

This can even affect applying for a mortgage and rented property too.

Essential to note is that in most cases, different lenders calculate credit scores on their own. In other words, they make their own calculations. As a result, you might end up having different credit scores for different lenders. Though there are some lenders who offer “no credit check loans“,  it may be better, in the long run, to work on improving your credit score as “no credit check loans” are likely to charge higher interest rates.

All that matters is that all your credit score remains as good as it can possibly be.

Discover these tips and tricks to improve your credit score!

Credit Card Protection: Explained

There are so many benefits to using a credit card, one of which is credit card protection. However many of us don’t fully understand or use these safeguards that free.

Under Section 75 of the Consumer Credit Act, you are protected by your credit card provider for purchases. But what does this mean, and are you safer paying with a credit card than with cash or a debit card?

Piggy Credit Card

Here’s credit card protection explained:

Section 75 of the Consumer Credit Act

In a nutshell, this law means that if you purchase anything such as a laptop or a holiday between £100 – £30,000, your credit card company is as liable as the company from where you’ve bought your product if it is faulty.

These are the situations where you’re covered:

    • If the product is faulty or not up to standard
    • If the company has misrepresented what it is supplying
    • If you do not receive your purchase after ordering it

Fortunately, you do qualify for reimbursement even if you make a part payment for a purchase with your credit card. So if you paid a £30 on your deposit credit card and another £300 on a debit card you would be able to claim for the full £330.


Chargeback also allows you to try to recover purchases under the £100 limit and is available on debit cards and credit cards like Visa, Amex, Maestro, and Mastercard. However this is what’s known as a ‘Scheme Rule’, so it is not legally binding unlike Section 75. For this reason, you are better to claim on Section 75 if you have spent over £100.

When do you not qualify for Section 75?

There are certain requirements to qualify for this act, for example, the individual item you have bought must be over £100, rather than the total bill. For example, if you purchased a return plane for £120 you would be eligible, but if you paid £60 each for one-way tickets then you would not qualify.

Use this page to find out how to claim your credit company.

As always, making payments with credit cards can be very beneficial for your finances such as protecting your money and managing your outgoings to spread the cost of expensive purchases. But it is important to use credit cards responsibly and create a sustainable budget that you can stick to so that you can avoid potential financial difficulties in the future.

If credit cards aren’t for you, there are many other borrowing options available. 

  • Overdraft. An overdraft can be used for short term borrowing or emergencies. It allows you to borrow money through your current account for a charge. 
  • Payday LoanPayday loans are another form of short-term borrowing. They’re quick and convenient ways to get access to cash for emergencies, and are repaid in full on your next payday. Most payday loan lenders can help secure loans for poor credit borrowers
  • Instalment Loans. If you’re unable to repay your loan fulling on your payday, instalment loans are flexible and manageable ways to borrow. Rather than paying your loan in one go, an instalment loan allows you to spread the repayments over weeks or months. 
  • Bank Loan. If you’re looking to borrow a large amount, a bank loan may be better suited. Unlike payday loans, personal loans from banks and building societies tend to be for over £1000 and spread over months rather than years. 

If you’re looking to get an instant loan online, PiggyBank can help! We’re a direct loan lender, offering both payday and instalment loans.

8 Common Credit Card Mistakes to Avoid

They say that half the battle is knowing what NOT to do. If you’re looking to start building up your credit or repair a bad one, responsible use of a credit card with regular purchases and on-time repayments can help improve your credit score. A better credit score will make it easier for you to get accepted for financial products such as mortgages and loans.

Here’s 8 common credit card mistakes to avoid:

    1. Making late repayments – if you miss a repayment date you’re opening yourself up to late fees and potentially a damaged credit score. You can avoid this by setting up automatic payments or payment reminders through your provider.
    1. Only making the minimum payment each month – paying the minimum payment means the remainder of your balance is unpaid, collecting interest. You should always plan out how much you’ll be spending on your credit card and paying the full balance off each month.
    1. Ignoring statements – if you don’t check your credit card statements each month you could be missing important information such as changes to your credit card terms.
    1. Becoming too dependant – your credit card should ideally only be used for small payments or emergencies. If you find you’re becoming too dependant on your credit card, your balance could reach unmanageable levels and lead you to bigger troubles in the future.
    1. Exceeding your limit – exceeding your credit card limit puts you at risk for fees, penalties and could affect your credit score. You should always keep an eye on your balance and set up automatic reminders so it doesn’t come as a shock.
    1. Not knowing the terms – all credit card companies handle circumstances such as late payments differently. Before applying for a credit card or switching to another provider you should fully read the terms and conditions so that nothing comes as a surprise.
    1. Withdrawing cash – withdrawing cash from your credit card can come with some very steep fees, so it’s always best to avoid this entirely.
  1. Applying for too many cards at once – if you apply for a number of credit cards at once, this is visible to lenders who may get suspicious and decline you. You should only apply for credit cards one at a time.

You should always remember that using your credit card can be a bit of a double-edged sword. Used correctly, they can help improve your credit score, but used incorrectly they can have the opposite effect.

For more information on long term lending contact today.

Could These Surprise Factors Be Affecting Your Credit Rating?

Building and maintaining your credit score is vitally important to maintaining your creditworthiness, as potential lenders will use this score when assessing the risk of lending to you.

Your credit score can fluctuate depending on your behaviour, such as falling behind or missing payments entirely. However, there’s a surprising number of factors you may not know about that could be tanking your credit score!


Not alerting utility providers or creditors that you’ve moved

If you receive any paper-based bills or communications from utility providers or creditors, it’s vital that you update your records with them and provide your new address. Otherwise, you could have bills or debt left outstanding without your knowledge, which will negatively affect your credit score.

If you want to be certain you’re not missing any important post when you move you can set up post redirection from Royal Mail, which will automatically direct post going to your old address to your new address. It costs £31.99 for 3 months, £43.99 for 6 months and £62.99 for 12 months.


Upgrading your phone

Many of us like to upgrade our phones every few years, but you should always check that your old contract has been fully cancelled off. There have been cases where providers have accidentally left old customer contracts open without their knowledge. As the contracts were unpaid, customer credit scores fell as a result.

When changing contracts you should always double check the old contract has been closed and keep an eye on your credit report at regular intervals to make sure nothing has slipped through the cracks. There’s a number of free providers you can use such as ClearScore and Experian.


Not using your credit card

A credit card can be useful for building your credit score, as it shows regular credit utilisation.

It’s always beneficial to keep your credit utilisation rate low and not too high, as this could show you’re having trouble managing your finances.

However, if you don’t use your credit card at all it could be closed due to inactivity which has a knock-on effect on your credit score. Having your credit card closed can not only hurt your credit score but increase your credit utilisation to high levels as your total credit limit has now been reduced.

If you’ve managed to avoid these factors, great! But always remember – you should always regularly check your credit score to avoid any future surprises. Having a good credit score will help you secure loans in the future. However, some lender can also help secure loan for poor credit borrowers. 

If you want to build up your credit score, check out these 5 top tips!

Understanding Credit Reports and Who Looks at Them

Have you ever wondered how a lender decides whether to give you credit? A credit report is an important tool for determining your credit history and assessing the risk of lending to you.

What your credit report shows:

    • Your current credit accounts – this includes your bank and credit card accounts and other current arrangements such as outstanding loan agreements or utility company debts. If you’ve previously made late or missed payments these will be recorded and stay on your credit report for at least 6 years.
    • Relevant details of people who are financially connected to you if you’ve taken out joint credit.
    • Any public record information such as County Court Judgements (CCJ’s), bankruptcies, house repossessions and Individual Voluntary Arrangements (IVA’s). These will also stay on your credit report for at least 6 years.
    • Whether you’re on the electoral register.
    • Your full name and date of birth.
    • Your current and any previously recorded addresses.
    • If you’ve previously committed fraud.

What your credit report doesn’t show:

    • Your salary.
    • Your religion.
    • Your criminal record.

Who looks at my credit report?

When you apply for any type of credit, this will usually involve giving the provider permission to check your credit report to assess your credit history. This can include banks, credit card companies, direct loan lenders but also mobile phone providers, employers and landlords. 

These companies can choose not to lend to you if you haven’t previously managed your credit well. In some cases, the credit provider (such as credit card companies) may offer your alternative options, such as smaller amounts of credit or a higher rate of interest. In these cases, many people have been tempted by “no credit check loans“.

In cases where you’ve been unable to keep to the terms of a credit arrangement and set up a payment plan, this will show on your credit report. However, a payment plan can show that you have taken a positive action towards your account which will clear your outstanding balance quicker and in turn help your overall creditworthiness.

How do I check my credit report?

There are a number of free providers such as ClearScore or Experian.

What if there’s an error on my credit report?

If you spot any errors on your credit report, you should contact the lender directly and explain the situation. Always remember to provide as much evidence as possible to ensure a quick resolution.

How do I improve my credit score?

If your credit score isn’t in the best shape, there are a number of ways you can improve it.

Your first step should be to ensure that there are no errors on your credit report (above).

You can then:

    • Pay your bills on time to show you manage your finances effectively.
    • Avoid CCJ’s – if you’re having debt problems you can seek free advice.
    • Reduce your existing debts by paying off credit cards and overdrafts.

For more information, take a look at our 5 Ways to Build Your Credit Score guide.

What Creditors See On Your Credit Report

In today’s world, we are constantly bombarded with advertisements for quick cash and free credit scores. Credit reports are a necessary when buying a home, car, and other big expenses that will require a loan. Knowing the information that the creditors will see on your report can make a huge difference in the amount of money you will receive or if you will receive a loan at all. Making sure your credit report is accurate before giving a lending agency permission to obtain it can save you time and aggravation during the process. When you request a credit report, you should know what the information on it represents and how it will impact the goals you are trying to reach.

Personal Information

This information does not contribute to your credit score. It is used to identify you.

  • Legal Name
  • Current Home Address
  • National Insurance Number
  • Birth Date
  • Employment Information

Credit Accounts

This can also be referred to as your trade lines. Every agency that you have established credit with reports the following information.

  • Type of account you have (credit card, car loan, etc.)
  • Date the account was opened
  • The amount of credit or amount borrowed
  • Your current balance
  • Your payment records (including all late payments)

Credit Search

This is a list of everyone who you have given permission to run your credit in the last two years. There are two types of searches that will appear on the list.

  • Voluntary Inquiries: Requests you have made for your credit report.
  • Involuntary Inquiries: When a lender or other agency requests your report.

When reviewing this information, you want to pay attention to involuntary inquiries, make sure that no one has run a report without your permission. If you do not recognise a name that is listed, make sure that you follow up and find out who they are and why they ran an inquiry.

Public Records and Collection History

This information is available from public records that are obtained by county courts and from collection agencies.

  • Bankruptcies
  • Insolvency
  • Home Repossession, or if you have unpaid debt at a previous address
  • If you have committed fraud
  • County court Judgement

If you find that information is incorrect or has not been updated, you must ensure that it gets updated. You can do this by contacting the original lender or agency and request that they send the updated information so your report will be corrected accurately. Don’t trust that this will happen automatically, follow-up will be necessary to make sure that it is taken care of appropriately.

Knowing what information will appear on your credit report will prepare you to answer any questions that lending agencies will require you to answer accurately. It will also allow you to make sure that all of the information is accurate. If you are planning on making a big purchase that will require a loan you can count on a credit report being required. Understanding the information provided and what your score actually means in relation to your ability to receive a loan is important.

For a payday loan or a short term loan, contact us for more information.

How To Keep An Eye on your Credit History

Before you apply for a loan, or any type of credit, it is always a wise idea to check what your actual credit score is. Whoever you are applying for a loan from will certainly be aware of this score, and it can have a massive effect on their final decision. Here, the Piggy Bank team take a look at how best to stay in touch with that score, whether you are applying for credit or not.

Your first step would be to choose a credit checking company such as Experian, Equifax or maybe one of the newer services that has sprung up in the last few years. You will need to furnish your chosen credit checking company with details, including your addresses for the last 3 years or more. These days, you can usually find out your credit score very quickly, often within a few minutes.

Once you have this facility set up, it is a good idea to go through your score, and look out for any anomalies. You should check whether you are on the electoral roll because this will improve your rating. If you are not, speak to your local authority and remedy this as soon as possible.

If you have any adverse credit history, this will affect the decision that your potential creditors will make. You should try and contact the company in question, and do your best to either pay off any outstanding amount, or come to a mutual agreement in terms of paying it off.

For more information on long term lending contact today.