You could increase your credit score with five easy steps – ‘improve your chances!’

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A credit score indicates someone’s creditworthiness, and the higher the score the better a person looks to a potential lender. Some, however, may have damaged their credit score in the past, for example, by failing to meet payments on time or taking out expensive loans. Whatever the situation, vast numbers of Britons are looking to improve their credit score, to boost their finances and ensure security.

Thankfully, though, there are some easy ways to do so, and it will be important for individuals to pay attention. 

Neil Kadagathur, credit expert and CEO of Creditspring, spoke to Express.co.uk to offer advice to Britons struggling with their credit score. 

Firstly, the CEO highlighted, it will be important to avoid high-cost credit, alongside paying off any debts.

This is a vital issue to consider as many lenders will make sure a borrower can afford to take out a loan before the process can progress any further.

Being on time with credit agreement payments and avoiding higher-cost credit such as payday loans will be useful.

Such loans could impact a person’s ability to access credit if frequently relied upon.

Next, Mr Kadagathur said, undertaking administrative work will be key.

He said: “To check a person’s creditworthiness, lenders will often ask to see proof of ID or residency.

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“For most people, this is an easy box to tick by registering to the electoral register or by having other credit accounts at the same address.

“It’s essential to check that all information, including address history, is recorded accurately on your statutory credit report and if not, get in touch with credit reference agencies to inform them of the error and request it is updated.”

When a person is thinking about their credit score, a particularly important component will be credit limits.

And Mr Kadagathur has explained it will be vital to balance high limits with low use.

Lenders may offer a person a higher credit limit, perhaps which they do not need, however, he advised taking the opportunity.

This is because it is a show of trust between a lender and a borrower, which can be a good sign.

However, with that being said, it will be a good idea not to use the extra credit limit, so one’s credit utilisation rate remains low.

This is the percentage of credit available to a person versus the amount which they are actually using – something which can be vital in boosting a credit score. 

Finally, when looking to increase a credit score, having an understanding of one’s credit file is likely to help along the way.

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Many people are not aware of small defaults or late payments which have happened in their finances.

But this could prove a significant hindrance to securing credit if someone does not take action on the matter.

As such, Creditspring urges individuals to clean these up as soon as possible to ensure an immediate credit uplift.

Most importantly, though, Mr Kadagathur said worrying less about credit scores is key.

This may be surprising to those who believe their credit score is the most important aspect of their finances.

However, the CEO explained: “It’s important to remember that your credit score is just one variable when it comes to accessing credit, and it may not be as important as you think.

“While having a good credit score can improve your chances of being approved for a loan, there are other factors that are also important, and the information that is on your credit report is really what lenders will be looking at.”

Individuals will be able to access their statutory credit report easily from any of the major credit reference agencies. 

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