How to boost a bad credit score

Credit scores are really important. This vital piece of information is what lenders use when considering applications for financial products such as loans, mortgages and credit cards.

Your score is compiled by credit reference agencies such as Experian, Equifax and TransUnion. It is affected by several factors – particularly your repayment history or any current debt.

Whatever your rating is, it will have a huge influence, not just on your ability to take out credit, but the interest rates of your repayments or the spending limit on credit cards. The better your credit score the more you will benefit from low interest rates and higher spending or borrowing.

People who pay their bills on time will get the highest scores but the figure can also be affected by other factors, like if there are mistakes on your report or you make multiple applications for credit.

Even if it is the result of a mistake, a low score is a real financial obstacle, whether for now or for the future.

If you have a low credit score it can also feel impossible to know how to improve – especially if you have been rejected by card or loan providers because of a bad credit history. But there are some really simple things you can do.

Monitor your credit score

By checking for any errors on your credit report, such as inaccurate personal information, loans incorrectly marked as unpaid, or accounts fraudulently opened in your name, you can ensure that your report is an accurate reflection of your ability to manage your finances.

You can check your credit history by contacting a credit reference agency to request a report. However, they may charge you for regular reports. Alternatively, companies like Boshhh offer free monthly reports on your credit score as part of their credit-building SIM card.

Get free access to your credit report with Boshhh

Join the electoral register

When you register on the electoral roll you’re giving lenders proof of your name and address. This allows them to easily and confidently verify your identity and combat identity fraud.

Joining the electoral register takes a few minutes max but will have a really positive impact on your overall credit score.

Make full repayments on time and set up direct debits

If lenders see missed payments on your report they’ll assume you struggle with managing your debts. Making your repayments in full and on time proves to lenders that you are sensible with your money and can pay back what you borrow.

Setting up direct debits through online banking to pay your bills will help prevent this. It will ensure that you clear your balance automatically without having to remember every time the credit card bill arrives.

Hold off on making more applications

If you’re rejected by too many lenders, this will leave a ‘footprint” that will negatively affect your score.

When you make too many applications in a short space of time it will be interpreted by lenders as a sign that you are experiencing financial difficulties or have a poor financial record.

Limiting the number of applications you make, picking your applications carefully and spacing them out, will prevent this. You can also ask your lender to run a ‘quotation search’ instead of an ‘application search’ to help you compare rates – these won’t leave a negative mark on your report.

Reduce existing card balances or get rid of cards you don’t use

More than anything, lenders want to see evidence that you can manage your debts. They can be sceptical if you appear reliant on cards and overdrafts and are often close to your credit limit.

For a boost, try to keep your card balances to no more than 30% of each card’s limit.

If you already have credit available, whether multiple credit cards or a large overdraft, lenders view this in a negative light. Their logic would be: if you already have access to credit, why would you need to apply for more? So if you have credit cards you never use, close these accounts.

Get a Boshhh SIM

There are some groundbreaking new ways for people who may otherwise struggle to build up a good credit rating. Boshhh is the first credit-building mobile phone network: they have created a phone SIM specifically for those who need help building up a positive credit score.

Whether you are a student, an immigrant, or have a chequered credit history, if you pay on time each month, the Boshhh SIM will boost your credit rating – helping you build a brighter financial future.

Boshhh has a policy of guaranteed acceptance for anyone who applies. So even if you’ve previously been rejected for a contract, loan or other financial product based on your credit history, you can have peace of mind knowing Boshhh will give you a SIM.

Their SIMs are powered by the UK’s most reliable network with 99% UK coverage and come in a range of data plans. Every Boshhh SIM gives you unlimited calls + texts + unlimited EU roaming.

You’ll also get free access to your credit file via Equifax (normally £14.99 p/m) and access to their Boshhh Rewards scheme – with a selection of discounts with over 75 retailers, including Sainsbury’s, Greggs, Spotify, ASOS, Uber, and more.

They offer full customer support service for sign-ups, questions and cancellations – and provide one full year of protection). So even if you sign up and then default, you won’t worsen your credit rating!