Better Credit

Credit reference agencies are reporting increased profits during the credit crunch. Callcredit, for example, reported an increase in sales of 73% in 2008, and an increase in profits of 67%. This is because companies tightening up on the amount of credit granted are increasingly relying on information provided by credit reference agencies in order to carry out credit checks. As the agencies charge for this information, their profits increase.

However, it's not just companies that can find the services of these agencies valuable; you can also contact them if you have been denied credit, in order to query your credit report, and possibly have it amended. This could mean that your credit rating will improve, but you can also get a better credit rating by building up a good credit history. We will describe how to do this later in this article.
When you are turned down for credit you can ask the lender whether his decision has been based on information from a credit agency, and, if so, which one. You can then request a copy of your credit report from the agency for a small charge. Once you receive the report, you should check it for errors as you have the right to ask the agency to remove or amend any incorrect information.

Some companies use their own credit scoring systems to make decisions regarding the granting of credit. If the scoring system is computerised, you can ask for a manual check of your credit score, which may be more favourable.
Another way to get a better credit rating is by building up a good credit history, which you can do by obtaining credit from more readily available sources. Sometimes a person who has maintained a good payment record under a credit agreement could have a better credit rating than someone who has never had credit. This is because credit reference agencies don't just keep records of defaulters; they also keep records of good payment histories.

A number of companies specialise in providing credit cards for people with a poor credit history. Whilst the interest rates are usually higher on this type of credit card, you do have the advantage of being able to rebuild your credit rating, providing you make regular monthly payments. Some companies will even offer to send monthly reports to credit reference agencies regarding your payment record.
Obtaining a loan can help you in a similar way. Likewise there are companies that specialise in granting loans to people with a bad credit history. Again the rates are high, but it may be worth it in terms of the advantages. This type of loan is usually taken out for the short term, and often there is no credit check required.

If you need to obtain credit and want a better credit rating, bear in mind that if you apply to several companies that carry out credit checks, a 'search' will show up on your credit report each time, and numerous searches can adversely affect your credit rating.