Why do I have a poor credit score?

Poor credit scores are something that affects millions around the UK. Not only does it stop them from getting approved for bank loans and mortgages, but it can impact job prospects too. 

However, what people don’t understand is how a credit score can go from good to bad, or how to turn it around after a bad period. 

The experts here at Boshhh are here with more information on why credit scores can dip, and how to boost yours if it happens to you. 

What is a credit score?

A credit score reflects your financial responsibility and how likely you are to pay back a loan or instalments on a finance plan. 

The higher the credit score, the more likely you are to be approved for credit types in the future. 

What is a good credit score in the UK?

Consumer reporting agencies (CRA) differ slightly in their scoring models. When you sign up with Boshhh, you’ll be given a credit report with our partners at Equifax. 

Take a look at their scoring model: 

• 300-579: Poor

• 580-669: Fair

• 670-739: Good

• 740-799: Very good

• 800-850: Excellent

Credit scores are unique to you, and are not affected by where you live or your age. However, it’s worth noting that it’s common for younger people to have lower scores compared to those who are 50+, as they’ve not had as much time to build their credit report. 

How often does credit score update in the UK?

In the UK, credit scores update monthly, weekly or daily, depending on the lender, CRA and financial situation. 

As an example, Equifax updates every time you log in to your account, highlighting any changes to your account within a week of them occurring. 

Why is your credit score poor?

Credit scores will go up and down throughout your life, depending on your credit mix (types of credit you have), the amount owed, and if you have any new credit under your name. 

However, the things that really drag your score down are as follows: 

Borrowing history 

If you have a history of borrowing money regularly (in the form of loans, finance agreements and mortgages), it can show you’re too reliant on loans and aren’t earning enough to pay for your lifestyle. 

However, if you have no history of paying back borrowed money, you’re also showing you have little to no experience paying back money, in full and on time. 

Missed payments 

The more payments you miss, the lower your score will get. 

When you are late with payments, you’re showing poor money management and budgeting. This shows lenders you’re untrustworthy when it comes to repaying the total each month, and they’re less likely to approve any requests. 

Credit applications

If you’re applying for credit utilisation, one after another, the number of hard credit checks on your account will rise, and your score will dip - as, again, this would show that you are getting rejected often if hard credit searches are happening but no new credit files are opened on your account.

How to raise poor credit score 

If you have noticed a big decline in your score, you’ll be pleased to hear there are a few things you can do to bring it back to where you want it to be. 

Pay bills and credit payments on time 

A good way to do this is by setting up automatic payments for the day (or the day after) you get paid, so you can budget the rest of the month with the money you have left in your account. 

This also shows you can handle credit responsibly and are capable of paying back the full amount. 

Check your credit report regularly 

Checking your score and report on a regular basis helps you fully understand what’s normal and what’s not. 

Then, if anything out of the ordinary pops up, you can report it and get it removed from your account quickly, so it doesn’t affect your credit score and lending future. 

Register on the electoral roll 

Not being registered to vote means your location and identity are difficult to confirm, keeping your score at a minimum. 

If you aren’t already signed up, register today! It’s quick and easy and can add up to 50 points to your overall score. 

Build credit with Boshhh

Building your credit score is easy with Boshhh. 

Our SIM-only deals are designed to boost your score and monitor your report in an affordable and manageable way. 

Paired with an ultra-fast network connection, a compatible app (to check your score and receive industry credit tips), and a guaranteed fast credit boost, you’ll have the ability to build a brighter financial future in the palm of your hand. 

Learn more with Boshhh

Looking to improve your credit score?

Boshhh is here to help. 

Not only will our SIM-only deals help you turn your financial future around, but our app updates will give you more tips and tricks on how to keep your score as high as possible. 

You can also check out our blog for more financial advice. 

Get started today.