Having a low credit score, otherwise known as a credit rating, is not the end of the world however it can limit the amount of credit and other financial products you can get in the future. If your credit score is low then you’ll want to improve it if possible and below you’ll find a few easy ways to do this.

1. Check you’re on the Electoral Register
If you have moved house recently and have forgot to update your address then there’s a possibility that you’re no longer on the electoral register. This is one of the first places that financial providers look when performing credit checks and if you aren’t registered you’ll be turned down without a second thought. This point ties in with the next one.

2. Limit your Applications for Credit
Every time you apply for a form of credit, whether it’s a personal loan, credit card or mortgage, the lender in question checks your credit history and this leaves a trace that other lenders can see. Thus, if you apply for credit all over the place then anyone who checks your credit file can see this and to a lender this looks bad. Going back to point 1 above, if you apply for credit and are automatically turned down because you aren’t on the electoral register this rejection shows on your file but the reason for the rejection isn’t – hence it just looks like you’re a bad risk and lenders are all saying no.

3. Build up your Credit History
It may be that your credit score is low because you have little or no credit history. When this happens it helps to start building a credit history but without a history a lot of lenders will turn you down – Catch 22. In cases like this is it worth applying for a more expensive credit card aimed specifically at people with low credit scores and spending a little on it every month. You must pay the balance off at the end of each month though because the interest charges for these cards often reach 39.9%.

4. Pay Existing Instalments on Time
One of the easiest ways to improve your credit score is to manage your existing credit well. This means paying monthly instalments on time – and early if possible – and never, ever defaulting and missing your payments. Staying within your credit limit is also beneficial. If you’re going to have a problem paying the instalments then get in contact with the provider as they can often give a bit of leeway to good customers. If you don’t then they have the right to make a note of defaults in your file.

5. Cancel Unused Credit Cards and Bank Accounts
Unused credit cards and bank accounts that have credit facilities all show on your credit file. This means that lenders who check your file might see you have thousands of pounds worth of credit already – even though you aren’t actually using any of it. Cancelling these will clean up your credit file and possibly improve your credit score.

6. Pay off any Debts you can
Using savings to pay off large chunks of credit can also help to improve your credit score so this should be done as a matter of course. It is pointless having thousands in the bank and owing thousands on credit so pay what you can and lower the amount you officially owe.

Credit scores are hard to improve once they slip but if you implement the tips above you should quickly see some improvement.