Getting a loan prior to the recession was as easy as walking into a clothes shop and buying a new pair of jeans. No shop assistants asked you whether you’d still fit into the jeans in a year’s time; they didn’t check your background to see if that pair of jeans was going to suit you in the long term and you didn’t have to go back every month and pay. Loans were easy to come by. There were no lengthy credit checks; you didn’t have to jump through hoops proving this and that and you weren’t charged over 7% interest on a loan of less than £5000.

Things have changed since then, perhaps, in a way, for the better. After all it was sub-prime and irresponsible lending that got us into this mess in the first place. In depth credit ratings are a good thing as they find out just how responsible or irresponsible we all are. However, credit ratings can be incorrect through lack of or miss-information or completely ruined due to ID fraud. It is vital therefore that you keep on top of your own credit history with regular credit checks.

Your UK credit rating is compiled using all kinds of data from financial through to information from the electoral roll. Every time you take out a loan it is marked on your credit history. Every time you fail to make or miss a repayment, that is also marked. Good behaviour is noted accordingly too. A bad credit rating can mean you will only have access to high interest rates and unattractive credit offers or, worse still, you will be refused credit altogether. Credit Expert offers free UK credit rating checks which enable you to keep an eye on your credit rating and do something about it if it’s not up to scratch.

There are ways you can improve your UK credit rating. The obvious and most effective is to pay off your debt as quickly as possible. Getting your lending under control and paying off your debts in full and on time will rapidly improve your credit rating. However, if you are struggling to pay back your loan it might be worth consolidating all of your debts so you have one monthly payment. You could also speak to your bank about renegotiating your loan or mortgage.

If your credit rating is much poorer than you imagined, you may be a victim of identity fraud. Criminals are using ever more sophisticated ways to steal personal data then use this information to open bank accounts and run up thousands of pounds worth of credit. If you want more information about ID theft, visit the Crime Stoppers website.

Equifax provides advice for consumers finding it difficult to get credit because of a lack of information on their credit file

www.equifax.co.uk

London, 20th February 2012 – This weekend’s BBC Radio 4 Moneybox featured the plight of a consumer who had been unable to get a mobile phone agreement because she was not very credit active. The lady in question had what is known in the credit industry as a ‘thin file’. She didn’t have any history of credit agreements which made it difficult for the mobile phone provider to assess her suitability for new credit and, as a result, they declined her application.

Having a ‘thin file’ means there is little data on an individual’s credit file, making it difficult, sometimes, for banks, building societies and other financial services providers to confirm their identity as well as gain an understanding of their ability to manage credit. Neil Munroe, External Affairs Director of leading instant online credit information provider, Equifax, admits that this can be a ‘catch 22’ situation. Someone without any credit can find it difficult to get new credit. But he has some useful advice for others who may have ‘thin files’.

“Thin files are most likely to occur for people between 18 and 20, who have only just entered the credit market or those in their 60’s and 70’s who may not have been very credit active previously” explained Neil Munroe. “Women whose husbands have been responsible for their mortgage payments are another group that can have ‘thin files’.

“For some organisations their automated systems will decline new credit applications simply because they can’t verify the credit status of the individual electronically. It’s therefore wise for those with ‘thin files’ to take a number of steps to give prospective lenders more confidence in their ability to manage credit.”

“First and foremost, make sure you’re on the electoral roll. Lenders will want to be able to verify the identity of the individual, which they do through electoral roll data. Then, if you know you haven’t been credit active, it makes sense to try to create a credit history. To do this, you can go to the bank or building society where you have your current bank account. They will have a picture of your financial history and, therefore, are more likely to extend new credit to you. So by opening a credit account of some sort with them, which you should keep paid up to date, you can start to create that credit history.”

“Another way to create a credit history is to apply to an organisation like a store card provider where they may be prepared to provide credit on the basis that you are buying goods from their store.”

“But if a credit application is rejected it’s important not to keep applying to new companies because this may also affect your ability to get credit”, continued Neil Munroe. “The more times it appears someone has applied for credit in a short space of time, the more likely a lender or organisation extending credit may reject the application because they will be concerned this will be an indication of possible fraud or over-indebtedness.”

“Instead, we strongly advise anyone who is planning to apply for credit, or who has had an application declined, to get a copy of their credit file – so they can see straight away what information is being used to assess them. They also have a right to ask the lender for a reason for their decision.”

“And if the consumer does believe that their lack of credit history is at the root of their inability to get credit, but they have a good history of paying other financial commitments, such as utility bills, then they can add a statement to that effect to their credit file, which lenders are obliged to read. This is called a ‘Notice of Correction’.

Equifaxoffers a free online credit check, where you can view your personal credit report, including any joint agreements you may have. The Equifax Credit Report, with the facility to access credit information for the first 30 days free, gives consumers a valuable insight into their credit status. Accessible simply by logging onto www.equifax.co.uk it is designed to help individuals understand their credit file and see what lenders see to assess new credit applications. It also includes expert tips and advice to help consumers take the right steps to manage their finances and navigate through life’s challenges.

If the customer does not cancel before the end of the 30 Day Free Trial, the service will continue at £6.99 per month, giving them unlimited online access to their credit information and weekly alerts on any changes to their credit file. It also includes an online dispute facility to help them correct any errors on their credit file simply and quickly.

Most of us know what our credit report is, and that it is used when we apply for credit. But do we all know that we can actually see our credit report, and why we should check it?

This article will cover:

• Why look at your report
• What should you look for
• How it can detect fraud
• Where to obtain your report – FREE!

As mentioned in a previous post, one way of improving your credit score if you have had a period of bad credit is to get a credit card.

Now, this is easier said than done – especially if your score is still bad. If you are not sure what your credit score is, then check it for free.

Once you have been approved for a card then the quickest way to rebuild your credit rating is to put your petrol or monthly shopping on there, and then pay it off in full at the end of the month before the interest gets added – just make sure you set up a direct debit so you don’t forget, and get landed with a late repayment charge, and lowering your score.

Vanquis Bank’s products serve customers ranging from those who have had credit problems in the past, to those completely new to credit, are self-employed or have a low income.
Their aim is to provide a range of credit cards that give you the options you deserve.

Their Visa card that offers all of these great benefits:

* No annual fee
* Up to 56 days interest free on purchases
* Additional cardholder/ free fraud monitoring at no additional cost – we’ll warn customers of any suspicious activity on their account
* Chip PIN technology for added security whenever a Vanquis card is used
* Visa is widely accepted in the UK and abroad
* Offers convenience for paying online and over the phone
* A friendly and dedicated UK customer call centre
* As a provider that is specifically geared towards servicing customers with previous credit problems or little or no credit history our higher APR’s reflect the additional business risk posed by this area of the consumer market.

Apply for a Vanquis Credit Credit and start to rebuild your credit rating.

Please Note: this does not imply that they are able to approve applications from customers irrespective of their present or previous circumstances. Vanquis have stringent and specific criteria that potential new customers must meet in order to be accepted, as well as applying all relevant money laundering and other regulatory validation tests to any new applications.

Bad Debtors Be Warned, You Are Being Watched!

By: Michael Challiner

As the recession takes a hold more and more people are struggling to repay debt. Personal debt in Britain is increasing at a dramatic rate and is now approaching the 1.4 trillion pounds mark. However for one sector, business is booming. These are the private investigators charged with tracking down non payers of debt.

Why should people get away with not paying? says a spokesperson for the Bankruptcy Advisory Service, which counsels bad debtors. There is an issue of financial morality: some people do borrow either in the full knowledge that they can t repay or that they have no intention of repaying.

Employed by banks, building societies and some accountancy firms (who themselves are employed by lenders) private investigators are hired to see whether debtors have any hidden wealth.. They can trawl and search all sorts of databases to discover the size of a person s debts, track down their quarry, including credit reference agencies. Private investigators can also work out how much equity people have in their homes by looking at the number of mortgages registered against that property and its current value. All of this perfectly legal and is happening every day.

Investigators may move to more devious, complex surveillance if basic searches suggest the debtor has access to substantial assets. And some, it seems, are not afraid to push the boundaries to the limits.

The most well known tactic is bin spinning . This means trawling through someone s rubbish in search of information such as bank accounts, balances, investments and pensions. This will then provide their clients with a complete financial picture of the individual. A spokesman for a major investigation firm says he knows of investigators who have taken away rubbish sacks in the early hours of the morning, gone through their contents entirely, copied anything found which could be significant and returned it all to the bin. Again, this is all perfectly legal, he adds.

A former private investigator, who has recently left the industry and wishes to remain anonymous, says he used illegal methods all day every day for his financial clients. Every single detective or investigator breaks the Data Protection Act at least once a week. If they say they don t, they re lying.

He admitted that he would make hundreds of phone calls a day, pretending to work within certain organizations. Each call would provide him with a tiny piece of confidential data that over time built up like a jigsaw puzzle to provide a fuller picture of a debtor s finances.

However, these tactics could fall foul of the Government s Information Commissioner, according to a representative of trade body the Association of British Investigators. He says They are getting tough with people who break data protection laws. In some cases they are prosecuting investigators. Another investigator says of his industry: More are breaking the law than not breaking it. The banks will say we didn t know , but it s difficult to argue that if they re expecting to receive accounts and balances.

Author Resource:-> Promise Debt Solutions ( http://www.promisedebtsolutions.com ) offer Online Debt Help, Online Debt Advice, Online Debt Plans and Online Debt Management. Visit Promise Debt Solutions and we promise to help.

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For those who haven’t heard of credit ratings before, it is basically a lenders way of deciding how safe it is to give you their money! The lender scores you on a set criteria (which is never published) to see how credit-worthy you are.

It’s based on a number of things such as your borrowing and repayment history, any CCJ’s, any current credit agreements, time at address, and whether you are on the electoral role.

So……..what’s next?

Firstly, I would highly recommend getting a free credit report from Equifax.
I started by getting a free trial, and now I find it worth my while to subscribe to a credit reference service so that I can check my report at any time. It lets me see outstanding credit balances that I have, and also allows me to ensure that no one has set up any borrowing facilities fraudulently in my name.

Once you have looked at your report, then why not purchase their score report, which actually scores you…so you know how likely you are to get accepted for credit.

So how to improve my score:

1) Ensure you are on the electoral roll, and this is reflected in the Equifax report

2) Ensure all of your lenders have your current address

3) If you have any unused credit facilities, such as credit cards which you have paid off the balance, then shut it down. If you have credit available to you then you may be less likely to be approved for future credit.

4) Ensure you do not default on payments. If you have a secured loan then you may find yourself losing your house – which is far worse than just having a bad score!!! Make your monthly payments on time.

5) Be careful who you “get into bed with”! If you decide to set up a joint bank account with your loved one – then ensure they have a good credit rating! Once you set up a current account, or get a mortgage with someone, you then become financially linked. So beware!

6) Don’t apply for lots of finance loans within a short space of time. If you get rejected, then wait a few months before re-applying. This can seriously mess up your score, and happened to me a few years ago.

So, what are you waiting for? Visit Equifax and make the most of their free trial. I found a free trial so helpful in sorting out my finances, spotting errors, and ensuring I maximised my chances of getting the unsecured loan I required to buy my motorbike!

Individual Voluntary Arrangement can help you get out of debt

If you have incurred debt and are looking for debt solution, you can take help of individual voluntary arrangement (IVA). There are many organizations that can help you with debt reduction and also help your finances stay steady. It’s completely a voluntary option and cannot be forced on you.

What is an IVA?

An IVA is a legal binding between you and your creditor and you agree to make single monthly payment for 5 years. Apart from the payments you can make, the rest of your debt amount is cancelled by the creditor. This is a legal contract and during the agreement, the creditor cannot add any more interest rate or any other charges.

In the IVA, you still have to make single monthly payments but you make the payments which you’ll be able to manage and not more than that. But you must make sure that you follow the rules of the IVA and not fall behind in your payments. If you fail to make regular payments, you may even have to face bankruptcy or may have to pay full outstanding balance as per the creditors.

What are the advantages of IVA?

It completely depends on you when you agree to an IVA. There are quite a number of advantages of paying your debt according to this agreement. Take a look at the advantages of IVA:

1.You get rid of debt after few years.
2.You pay the amount that you can pay and not more than that. The rest of your debt payment is cancelled by the creditor.
3.Singe monthly payment is required in an IVA.
4.Your house and other assets are protected in an IVA and your unsecured creditors cannot ask you to sell off your house.
5.The interest payments are stopped as per the law.
6.You’re not harassed by the creditors for the debt payment.

What are the disadvantages of IVA?

Apart from the advantages, there are also certain disadvantages of this agreement. Check out the disadvantages of getting into this agreement:

1.If you default in your debt payments, it may result in bankruptcy.
2.The equity of your house goes to your creditors. This can be done by extending your mortgage payments toward the end of the IVA. You can also extend your IVA payments for the next 12 months.
3.The creditors may not agree to this payment.
4.The credit rating suffers a lot and the credit score remains low for one year after the IVA.

If you want to go into this agreement to pay off your debt, you must consider all the options before you agree to this legal contract. You do pay off your debts but your credit score suffers and you also need to release your equity to the creditor. But according to the requirement of IVA, you may not be required to sell your house.

Author’s Bio: M.J. is a contributory writer associated with some financial communities and has written several articles for various financial websites. She holds her expertise in the debt industry and has made significant contribution through her various articles.

You have just seen the house of your dreams but you have had credit problems.  The ability to find home loans with bad credit can be difficult but not impossible.

Previous to 1990 if you did not qualify for a FHA or VA home mortgage it was very difficult to get a mortgage.  This since has changed and there are companies providing home loans with bad credit on a daily basis.  These loans were introduced to help high risk borrowers to secure a mortgage and become homeowners.

When you are looking for home loans with bad credit you will probably want to look into what is called a subprime loan.  This is a loan to persons with a damaged credit history and would be considered a high risk borrower.  Because of the higher risk, subprime loans normally require a larger down payment and a higher interest rate.  The higher the risk the lender feels you are, based on credit scores and other factors the higher the rate to borrow will be.  If the risk seems lower you could receive a lower rate and lower down payment even if you are still considered a high risk borrower.

Most subprime loans have .1% up to .6% higher rates than those of a conventional loan.  This may not seem like a lot but when thinking in terms of a $100,000.00 dollar home the difference is in thousands of dollars.  So even if you are considered a candidate for a subprime loan it is important to shop for the best rate available.

Home loans with bad credit are made because lenders know that often a person with less than perfect credit did want to make their payments but because of illness, loss of employment or some other event out of the borrowers control may contribute to late payments or foreclosures.

If you were searching for home loans with bad credit you will want to keep in mind a couple of important tips.   You will want to plan on keeping this loan, for about two to five yearsYou will want to be using this time to help increase your credit worthiness by cleaning up old debts and obligations.  You will want to be sure to make your new mortgage payments on time.  After this process you can try and qualify for one of the more common and lower rated loan.

If you already own a home, and had some financial difficulties a subprime loan may help you to regain your credit status.  By refinancing with home loans for bad credit you can refinance for more than you owe.  Take the cash back on the equity you have and use this to pay off high interest credit cards, liens, or collections.  You would save money each month and be rebuilding your credit rating at the same time.

As you can see finding home loans with bad credit is a bit costly but it is not impossible and the final outcome is with good money management you increase your credit rating and own the home of your dreams.