Your credit score can be influenced by a variety of factors. It’s important to know which actions or habits could help or hurt your score over time. Here’s a breakdown of the most common factors to keep in mind:

Whenever you apply for a new credit product, such as a credit card, loan, phone contract, buying something on credit a “hard” search is performed on your credit report. While a single application typically has a minor effect on your score, multiple applications within a short time could hurt your credit score. This is because lenders may view you as someone who is overly reliant on credit.

Try to avoid damage to your score and where you can, use "soft" searches to check your eligibility before applying, as they won’t impact your score

Lenders like to see stability, which is why they often look at how long you’ve lived at your current address. Being listed on the electoral roll also helps verify your identity.

Tip: Try to make sure you're registered on the electoral roll at your current address as soon as you can and that it appears on your credit report.

Older credit accounts are seen as a sign of reliability and stability. Lenders prefer to see that you’ve been trusted with credit over a longer period of time.

Missing payments or paying late is one of the biggest factors that can harm your credit score. If you miss multiple payments, your account may enter default status, which can have a long lasting negative effect.

Even if you're late, making a payment is better than completely missing a payment. It shows lenders you're willing to make things right.

This refers to the amount of your available credit that you’re actually using. Lenders prefer that you keep your usage below 25% of your credit limit. If you regularly reach your credit limit, it could signal that you’re overcommitted financially.

Serious financial issues like County Court Judgments (CCJs), Individual Voluntary Arrangements (IVAs), or bankruptcy can stay on your credit report for up to six years, causing significant damage to your score. Lenders are less likely to approve any credit when these issues appear on your report.

If you have any of these issues, it’s important to follow the rules set by the court or the debt agreement.

Mistakes can happen in your credit report. These might include incorrect names or addresses, or outdated information about your financial accounts. Make sure you check your credit report for any errors.

If you have no active credit accounts or credit history, lenders have nothing to base their decision on when looking at your credit application. This is sometimes referred to as a thin credit file.

Key Takeaways