Half of Brits have never checked their credit score

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One-third of Brits (32 per cent) don’t know how to check their credit score, leaving them open to possible identity fraud and a lack of financial awareness.

Many Brits are unsure what affects your credit score, thinking that your income (21 per cent), job title (21 per cent), and borrowing from friends and family (6 per cent) makes a difference.

However, over one in ten people (12 per cent) don’t think anything they do affects their credit score, and nearly half (45 per cent) don’t think missed payments affect their credit score.

Checking your credit score is one of the best ways to better understand your financial health. It can help steer you in the right direction when it comes to managing your finances, and help you become more aware of possible identity fraud. However, new research has found that half of the UK public (49 per cent) have never checked their credit score.  

The research, from credit management company Lowell, found that many people in the UK are unaware of the importance of credit scores, what will and won’t affect their score, or how to check it.

Checking your credit score is an important part of financial housekeeping, but a third of Brits (32 per cent) don’t know how to find out their credit score. Some 10 per cent of people check their credit score just once a year, and just a quarter of people (24 per cent) check their score once a month or more.

It’s not so surprising that people don’t like to check their credit scores often, as almost one in five people (17 per cent) believe that the amount of times you check your credit score harms your credit.

Checking your own credit score is known as a ‘soft check’. The check will be noted on your file, but it won’t have an impact on your score. However, applying for new credit, like credit cards, loans, or finance agreements, will require a ‘hard check’ from the lender – and repeated applications, or having a lot in a short time, can decrease your credit score.

A fifth (21 per cent) of Brits also believe that your job title and income can affect your credit score when this has no impact. Some 6 per cent of people think borrowing money from friends and family makes a difference, even though this also has no impact.

There are lots of things that can have an impact on your credit score – but more than one in ten people (12 per cent) don’t think that anything they do affects their credit score.

Three-quarters of Brits don’t believe that a phone contract can have an impact on your credit file (75 per cent), and two-thirds (66 per cent) don’t think that a car loan could affect your credit rating.

Also, almost half (45 per cent) don’t believe missed payments affect your score when missing payments by 30 days or more can have a huge impact.  

Two-thirds (66 per cent) of respondents also didn’t think that store cards could affect your credit score. Having lots of credit agreements, like in-store finances or hire purchases, can lower your credit rating even if you’re making your repayments on time. When lenders decide whether they’re going to lend to you, they might look at your total credit and how many different lines of credit you have open to see your total repayments.

Catherine Taylor, 29, from Manchester, didn’t know how to check her credit score and was faced with some barriers when she applied for a mortgage in 2020. She said: “I’d never even thought about checking my credit score before – no one in the bank had ever said that I should, or told me how. I’ve never had an overdraft or credit card or missed a payment on my bills, so thought I would be fine.

“When it came to applying for a mortgage, my advisor told me I had a low credit score due to low credit limits, and this limited what type of mortgage I could get.

“I was gutted and wished someone had told me sooner how important it was, and the best ways to build up your file.”

Commenting on the findings, John Pears, UK CEO of Lowell, says: “Looking after our financial health is a really important life-skill, this survey reveals just how critical it is for people to have access to the right tools and resources from an early age, helping them to be in control of their finances.

"Your credit score is one of these key tools, it has a huge potential to impact a variety of important life events, such as buying your first house or financing a car - so it's vital that people know and understand their score, what it says about them and importantly the steps they can take to help improve it."