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Myths About Your Credit Report

31st October 2012

If you’re in a protected trust deed in Scotland you may well be interested in how you can improve your credit rating in the future. If you’re in debt and considering a Scottish trust deed you may be concerned about how your credit report would be affected if you proceed. In this article we look into some of the many myths that exist about credit reports and protected trust deeds.

Will You Get Blacklisted?

There is no such thing as a blacklist of people that should automatically be turned down for credit. Signing up to a trust deed cannot therefore place you upon a blacklist. Any information that is held on your credit record is of a factual nature. Lenders use this information (and other information) to help them make profitable lending decisions.

Will Your Property Get Blacklisted?

Potential lenders cannot search for credit reports by address. They can only search a credit report using the name of an individual that has granted them permission to do so. This means that other people who happen to live in your home will not normally be affected in any way should you decide to proceed with a trust deed in Scotland.

Will Your Family Be Affected?

As mentioned previously, potential lenders can only search the records of an individual (not a property or a family). However, you may be financially associated with a family-member due to a joint financial arrangement. Two examples of this might be a joint mortgage or a joint bank account. In this case you may be “financially associated”. If you enter into a protected trust deed it will not affect the credit rating of a financial associate, but it might influence whether a lender will offer credit to them.

My Credit Score Is Stopping Me From Getting Credit

If you sign-up to the services of a credit reference agency they may provide you with a credit score. This score is not given to potential lenders. The credit score you are given is an estimation by the credit reference agency about how a lender may view you. In reality every lender will score any credit application you make using their own calculations about your credit history and current circumstances. Different lenders may credit score you in very different ways.

Lenders Will Reject Me If They See That Others Have

Getting quotes for credit will not be recorded on your credit file. Applying for credit will record a search on your credit file. Searches will not cause your credit rating to decline. Another lender will not be informed about whether you were rejected for that credit application if they view your credit report.

Having many searches on your credit file may affect your ability to borrow. This could be because lenders are worried that you are a victim of fraud or are borrowing more than you can afford to repay. After being discharged from a protected trust deed it’s wise to restrict the number of credit applications that you make within a short period of time.

A Credit Repair Company Can Help You Rebuild Your Credit Rating

If you’re looking to get credit after your trust deed you may be tempted to use the services of a credit repair company. In reality there is nothing that they honestly can do to assist you to immediately amend factually accurate information. If there is any factually inaccurate information on your credit report the lenders or the credit reference agency can correct this for you without any fee being payable.

The Starting Point After Your Trust Deed

The starting point for rebuilding your credit rating (after the completion of a Scottish trust deed) is to get a current copy of your credit report. A free trial for the service we recommend is available here. You will want to check the factual accuracy of the information that is recorded. If there are errors you will want to contact the lenders or the credit report provider to request that corrections be made.

You will then have a solid base from which you can begin to make improvements through the cautious use of credit in the future.

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