With thousands of individuals applying for credit every day for loans, mortgages, credit cards, mobile phones etc., lenders will do a credit search on you to establish whether you have the means and ability to repay the loan. To do this they use a credit reference agency, usually Experian or Equifax. They will also consider the information you supply on your application form.

How do these credit reference agencies help lenders decide if you are an acceptable risk?

Their decision is based upon the information held on the Electoral Roll (to confirm identity), records of County Court Judgements (CCJ's), Bankruptcies and payment records on current and previous credit accounts that are held by the Credit Reference Agencies.

What can you do if you are refused?

The lender is under no obligation to give you reasons why, however, for loan applications of up to £15,000, individuals have the right to know which agency supplied the information on which the decision may have been based, provided you request this information within 28 days of the initial application.

How do you get to see your file?

There are numerous ways of obtaining a copy of your file as detailed below:

• Internet - Instant access via web sites (*note* have credit or debit card ready!)

£2 Statutory Credit Report  - Three firms offer this service, they are;

www.equifax.co.uk www.callcredit.co.uk www.experian.co.uk

• Other checks
  www.myequifax.co.uk - £14.95
  www.checkmyfile.com - See what lenders see for just £9.99 with their report online.
  Here you can choose which of the three UK credit reference agencies you wish to search, or search all three with their Triple Agency Report for £19.99 Freefone 0800 612 0421 between 9am and 5pm, Monday to Friday.
• Post - you can request a copy of your file by writing or download the application form and post to Experian Limited. If writing the letter start “I am writing under section 7 of The Data Protection Act, to request a copy of my file”. You will need to include your full name and address (including postcode) of your current and all previous addresses covering the past 6 years. Don’t forget to enclose a cheque or postal order for £2, made payable to the agency you are contacting.

Need the form now instead of writing the letter then go to download the application form.

How to see your file for free

30 day free trial* https://www.creditexpert.co.uk/

If you sign-up today for a 30-day FREE trial of the Credit Expert Monitoring Service, then you'll get a FREE copy of your Experian credit report too. From the end of your 30 day trial period, membership is billed to your credit card at £6.99 per month.

Your Experian Credit Score from CreditExpert can be viewed for just £5.95 (single non-refundable fee).

*Remember to cancel it before the 30 days otherwise you will pay for the report*.

Disassociation - what is this?

If there is financial information on your file about people in your family with whom you have no financial connection, or people who have never been part of your family, you can write to the agency in question asking them to disassociate yourself from them. The agency may wish to make some enquiries or checks to make sure that you are not just trying to avoid a bad credit record.

Unless the agency has a good reason to doubt what you tell them, it must not continue to give lenders information about the other people that you have mentioned. You need only write to the agency that supplied you with your file, since disassociation information will be shared between the other main agencies.

What if the information is incorrect?

If the information is correct you cannot expect them to change it because it is embarrassing, only if it is incorrect can you do the following:

• Write to the agency asking it to either remove or change the entry that you think is wrong.
• Within 28 days from receipt of your letter the agency should tell you that it has either removed or changed the entry or taken no action.

Notice of Correction

If you are unhappy with the response or would just like to explain the information on your file you can send a Notice of Correction. This is a statement of up to 200 words that will be added to your file as long as it isn’t defamatory, frivolous or incorrect. Again the agencies have 28 days to respond.

If still no action, resend the Notice of Correction. If information is amended the agency must send details to any lender who has enquired in the last 6 months.

If an agency declines your Notice of Correction it must refer to The Information Commissioner, details given below.

Contact addresses:

Identity Fraud

If you are worried about identity fraud (where others obtain loans, credit cards and other services in your name) then you may want to be placed on the Protective Register, run by Equifax on behalf of the Credit Industry Fraud Avoidance System (CIFAS) - telephone number: 0870 010 2091.

Basically it means that when an application for credit is made then there will be additional checks to what is already in place. The cost for this is £11.75 per year.