Importance of a credit file
What is credit file?
A credit file is document which gives the detailed history of your credit transactions, maintained by a credit reporting agency. This is also known as credit report. What is the importance of credit file? When you apply for a loan a lender usually checks your credit file. It includes:
• Your personal details such as your name, address, employment, date of birth and driving license.
• Your application for credit
• Any over due payments
• Information of filing bankruptcy
• Judgments by court
• Public record information such as directorships
You need check your credit file for accuracy to ensure that everything is in order, as this report plays a major role in reflecting your financial status in the eyes of your lenders..
Why you need to check your credit file?
As a credit file contains information relating to your financial obligations and transactions, so this file is used by lenders and other agencies on deciding whether to give you credit. The information in your credit file affects your credit rating. So it is necessary that you check your credit file in order to avoid any discrepancies. If the information on your credit file is clean then your credit rating will be high, and you will not face any issues in getting finance. But if your credit file is filled with information relating to missed and late repayments, county court judgments, defaults then your credit rating will be lowered, and you may have to struggle to get any form of credit.
What should you check on a credit file?
There are a number of things that you should check on your credit file, and some of these are outlined below:
• Always check for inaccurate data on a credit file. There can be errors on your credit file, and this can affect your credit ratings. So check the data on your report and look out for such discrepancies. If you find then you should report to the credit bureaus and request them to sort all these quickly.
• Then check for the dates when you have made payments. There may be debts on your credit file that are still showing as outstanding even though you have paid them. You need to sort all these as soon as possible.
• It is also important that you check for any suspicious transactions. Your credit report can indicate if there is any case of identity theft. If someone has tried to take out finance in your name then it can affect your credit rating and causing you problems.
Your credits file rights:
Under the privacy act of 1988, your credit file rights include:
•You are entitled by law to receive a free copy of your personal credit file at any time upon request through any of the credit bureaus.
•You have the right to point out any discrepancies and ask the credit bureaus to correct them as soon as possible.
•Only the lenders and the credit reporting agencies are authorized to view your credit file.
•It is the duty of your lender to inform you if your credit application is rejected due to your poor credit history.
•The lender should seek your permission to examine your credit file and provide the information to a credit reporting agency.
You can build a good credit history by verifying your credit file at least once a year. Just make sure that your report is free from errors and you do not forget to execute payments on any of your accounts. The best way to keep your credit score high would be to maintain a good credit file.
Useful sites:
Get-creditcards.co.uk – Credit Repair. UK Credit Cards and Credit Repair. Get a good Credit Rating and Clean Credit History. We show you how to get CCJ’s removed.