Tips to Understand Your Credit File

Credit file is basically a file that holds all the financial information about you. It is a confidential file and is kept by credit reference agencies. This information can be released to only bona fide enquirers who are in genuine need for the information, for instance, potential lenders. The investigator should be registered with the Information Commissioner and the Office of fair trading.

There are different means from where agencies get this information such as Official Gazettes, from trade bodies like the Council of Mortgage Lenders, the Register of County Court Judgments and electoral roll. Agencies can also get this information from the lending companies and banks that have given you loans at any time in the past. Your credit file contains comprehensive financial information about you, such as it will provide information about your current loans and the past loans within a certain period, how many credit cards you have, your credit limits, information about payments made and so on. It will also provide you with information about any credit searches by lending companies over the past two years.

Lending companies take help from these credit files whenever you apply for any load, credit card or mortgage. Their aim is to check wherever your credit file contains any bad mark against you, ie for late payments, unpaid debts etc. In that case your application for credit may be refused. Certainly, your credit file plays a vital part in your life. It contains all the vital information that is important for you as well as for lending companies.

However, there is a good part as well, after every six years; The previous record either good or bad is deleted from your file. It means that any adverse information even bankruptcy case is deleted. Under the Consumer Credit Act 1974, you have the right to see all the information kept about you in the file. You just need to write to the credit reference companies and they will send you a copy of the file by law.

Credit reference agencies are registered agencies and you can get the information about these agencies from your local Citizens Advice Bureau. The major agencies however you can contact to get your information include Equifax, Experian and Callcredit pic. Make sure that errors and omissions are possible. No matter how efficient the organization is, they can make mistakes. For instance, if two people share the same name, there financial information may have been linked. It is therefore recommended to see a copy of your credit file periodically to make sure that information given in the file is purely related to you and there are no mistakes in it.

There is no hard and fast rule set for organizations to how many agencies that they need to send your financial data. Sometimes, organizations send information to only one agency or sometimes to two or three on irregular basis. This creates a chaos sometimes as each agency may have different information about you. So, better get a copy from each agency.

Source by Tauqeer Ul Hassan

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