Introduction
Having recently moved to the UK, you may be finding it extremely difficult to obtain credit. Find out why you get rejections from lenders as well as ways in which you can turn the situation around and enjoy the same benefits the other citizens enjoy.
Important Information About Obtaining Credit UK
If you are new in the UK, chances are you are finding it very difficult to get any loans, mortgages or credit. Normally, the fact that you lack any kind of financial records in the UK is a disadvantage. When credit UK lenders have no history to compare your future behavior to, you may be regarded as high risk, and many lenders may reject your applications. It is also impossible to transfer your own credit ratings from another country hence making it more difficult.
In order to increase your chances of getting credit in the UK, you should ensure that you have some positive credit history. Most banks and lending institutions will look for your records in the credit reference agencies before they can decide whether you qualify or not. The main agencies are Equifax, Callcredit and Experian. Your records from the three agencies will determine whether you get credit or not.
However, if you have no credit ratings, it becomes even more difficult. Among the first steps you should take is to get an address. Most lenders will want to see proof of your address from the time you make an application. The next thing you need to do is to get formal employment. This will show the credit UK lenders that you have regular income and you can therefore pay back your debts.
More Information About Obtaining Credit UK
The next step is to open a bank account. Your credit UK lender will be more confident in the fact that you can start paying their loans by direct debit as they can monitor your finances. Employment will also contribute directly in opening a bank account, as most banks require a letter from your employer
Having all of the above is important, but building your credit rating should be at the top of your list. The first thing you can do to make you an attractive candidate for credit UK is to register with the electoral roll. Many companies refer to it in cases of fraud and verification of identity. This is because the people listed in it are citizens with a UK address which is a requirement when applying for credit.
Another important tip you can apply is to know when you are eligible for credit UK. If you start to apply for credit from multiple places, checks on your history will be conducted. And since you lack strong backing, chances are you will be denied credit by the lenders.
Summary on Obtaining Credit UK
Every time you apply for credit in the UK, this information goes to your history. A history that has a lot of rejection in it will never be attractive. Therefore, stop applying for loans until you are sure that your chances of getting it are high; otherwise, you will taint your rating.
Ensure that you start to build your credit rating as soon as you can. Once you have your bank account, you can start by borrowing a loan from your bank. To increase your chances of getting credit in the UK, you may have to borrow high-interest loans or credit cards, as they have fewer customers. Your discipline in using the cards and repaying your loans will all go to your credit rating, so make sure that you use it wisely and pay up promptly.
