Lenders will want to know whether you are creditworthy. To help them decide whether you are a suitable applicant, they will almost certainly request a credit report.

Before any lender will give you a mortgage, they will want to know whether you are creditworthy. To help them decide whether you are a suitable applicant, they will almost certainly request a credit report from one of the three major credit reference agencies - Experian, Equifax or TransUnion.

What is Credit Scoring

All the credit reference agencies use similar methods to assess an applicant's suitability to receive a loan. The procedure used for this assessment is known as credit scoring.

An application form for a uk mortgage (or other type of loan) contains a range of questions relating to your personal situation. A number of points are allocated to each one of your answers to these questions. Your credit score is the sum of the points from your answers, which the lender uses to decide upon your suitability for being offered a loan.

Criteria that can Affect Credit Scoring

Your credit score can be affected by a number of issues and not all of them are connected to your financial situation. The following factors can can give you an adverse credit score:

Whatever your situation, avoid the temptation to put untruths on your loan application form. If you are discovered, you will definitely have your application turned down and you could possibly be prosecuted for fraudulent conduct.

If your loan application is rejected because of a low credit score and you want to know why, the credit reference agencies will provide you with a copy of your personal credit report (for a fee).

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