Getting your own back - protect your record

Nowadays it is very important to know what your credit record says. These massive computer files are held by three agencies and every time you want to borrow money or open a bank account they are consulted. If the computer does not like what it sees your application may be turned down or you may be charged a much higher price, says Paul Lewis

Paul Lewis

It is not only straightforward credit like a personal loan or a new credit card that is affected. Paying an insurance premium in instalments, taking out a mobile phone contract, or buying a sofa now but paying later all count as 'credit' deals.

If you fail to make a payment on time that will be recorded on your record and count against you. Any missed payment stays on your record for at least six years and potentially for six years from the end of the contract. For example, with a three year loan it can be up to nine years.

At the moment utility bills for gas, electricity and water do not go on your credit record. Nor do fixed line phones nor pay as you go mobiles. So if you miss those payments that does not affect your credit rating.

From time to time it is a good idea to look at your record and correct any mistakes. You have the right to pay £2 to see a copy of what a credit agency holds on you. But all three will try to get you to pay a lot more by offering a 'free' report which commits you to paying a monthly fee later. If you are well organised you can save money by ordering the free report and then cancelling your payment before the free period ends.

Here are the often well-hidden links for the £2 reports:

http://www.equifax.co.uk/Products/credit/statutory-report.html

http://experian.metafaq.com/resources/experian/Downloads/standardAppdec08.pdf

http://www.callcredit.co.uk/credit-reference.aspx

http://www.callcredit.co.uk/files/creditfile_app.pdf

Written by Paul Lewis, this article was published on July 23, 2009. Paul is the editor of Saga Magazine's Money News section. Paul's opinions are his own and for general information only. Always seek independent financial advice.

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