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!

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