Generally speaking, regardless if you are a first time buyer in Essex, moving house in Essex, or looking to expand your buy to let mortgage in Essex, the higher your credit score, the more likely you are to get accepted for a mortgage.
Remember that lenders have internal credit scoring systems that use the information held on your credit report, as well as information within your mortgage application. Every mortgage provider follows their own credit scoring policy, so if you are declined by one, you may still have a chance with another.
When it comes to which credit reference agency to use, or which one will the lender use, unfortunately, this information is not always given out.
Sometimes lenders will switch between companies such as Experian, Equifax, and Call Credit. It is good practice when looking to obtain a mortgage to check yourself against multiple credit reference agencies. This is because the information on one agency’s file may be different to others.
Until you have registered with one of the credit reference agencies to check your score, the thing you need to do ahead of everything else, is stop applying for new credit checks. You may only be doing something simple like comparing car insurance, but this can still cause unwarranted credit checks that may leave a footprint.
Lenders will use the electoral roll to carry out identity checks, so it is very important to make sure you’re on there. You have to also ensure that your name is spelled correctly and you get registered at your current address. If you’re unsure whether or not you are on there, you can check with your local council, as credit checks will show this and it can work in your favour.
Mortgage Lenders like to see some “active credit”, so having some kind of regular credit coming in and going out each month, like say a credit card, can also give you the edge (providing you keep up repayments). You must also remember, however, that doing this short term could have a negative effect.
Consistently almost hitting your limit or going over it can have a bad effect if you have credit. Make sure that you are within a safe distance and again, able to pay it off each month.
Another key tip is to make sure that you do not appear to be living in two places at once. This can occur if you accidentally give across the wrong living-in dates for the properties you were in.
It is always worth your time double checking whether or not the address format is correctly formatted, though flat/apartment addresses can make this a little difficult.
If you have any credit or store cards that you are no longer in use of, please close these accounts. Once again, remember that this could have a short-term negative impact on your score.
The systems can’t tell whether it is you or the lender taking this action, but it helps over time. Also reduces the chances you’ll fall victim to fraud if you were to ever lose your cards for any reason.
Ensure that all of your open accounts get registered at your current address and not an old address you were previously living in.
If you hold joint accounts, a mortgage, or a loan with an ex-partner, their poor credit history could directly affect yours. It is vital to inform the credit reference agencies that you are no longer associated with that person and remove any financial links that you have.
Credit scoring as a system is here to stay and can directly affect how your mortgage process goes. It’s quicker and more consistent for lenders to rely on their systems than human resources.
Having an up to date copy of your credit report to provide to your mortgage broker in Essex will help fully demonstrate your financial situation and help them recommend the most appropriate mortgage for your situation. Get in touch and we’ll see how we can help.
Date Last Edited: December 6, 2023