How to improve your credit score

Whether you require a mortgage, credit card, or vehicle finance, you’ll need a good credit score to help you do so. A credit score effectively acts as your financial CV and helps determine if lenders will let you borrow from them, and at what rate. 

If you currently have a bad credit score then you’ll want to know how to improve it, and if you already have a good credit score, then you’ll want to be able to retain it. Within this dedicated Octane Finance credit score article, we explain how long it takes to improve your credit score, as well as the 10 best ways to improve your credit in the UK… 

What is a credit score and why do you need one?

In short, a credit score is a number assigned to you based on your credit worthiness. It is calculated from your financial behaviour so that a lender can determine if they will allow you to borrow money from them.

Your overall credit history is taken into consideration so lenders can understand if you make repayments on time, and if you owe any debt. Bear in mind that if you share any credit with a partner - such as a loan or mortgage - then this credit behaviour is taken into consideration too.

There are three main credit reference agencies operating in the UK - Equifax, Experian, and TransUnion. Each works with banks, building societies, mobile phone companies and other retailers to help them understand more about the financial history of the person applying for credit. 

What is a good and bad credit score?

A credit score ranges from zero to 999 depending on your credit history - we’ve explained what constitutes a good or bad credit score… 

The higher a number is, the better credit score you have. So the lower a number is, the poorer credit score you have. Each credit reference agency works on a slightly different credit score basis; to help you fully understand each agencies process, we’ve listed varying credit scores for the three main UK agencies in the table below:

How long does it take to improve your credit score?

As much as we’d like to tell you that you can improve your credit score overnight, the truth is that there’s no definite answer as to how long this may take. It really does depend on a person’s individual financial situation (set out in your credit history report). 

Using your current credit score as a starting point, improving it will depend on a number of contributing factors. If you manage your finances effectively and already have a fairly good credit score, it may take as little as a month to improve it. 

If you have a history of bad financial management alongside a poor credit score, it could take up to 10 years to gain the results you hope for. The point to remember is, improving your credit score is absolutely achievable, so don’t give up!

How to improve your credit score

If you’re hoping to improve your credit score, there are many ways in which you can do so. Here are the 10 best ways to improve your credit score in the UK today:

1. Pay your bills on time. We know it sounds obvious, but paying your bills on time really can improve your credit score and demonstrates you can manage your finances effectively.
2. Register to vote. That’s right, registering on the electoral roll really will boost the chances of improving your credit score.
3. Use a credit card. Having a credit card is certainly one of the best ways to improve your credit score as it shows you can effectively borrow and pay money back on a regular basis. Just don’t be tempted to go crazy!
4. Don’t withdraw cash on a credit card. Whilst we’d advise you to use a credit card, don’t use it to withdraw cash. Interest can be high and lenders can see your cash withdrawal habits for up to six years.
5. Don’t use all the credit available to you. Whether it’s a credit card limit or overdraft on your bank account, don’t max out on the money that’s available to you - it will only go against you when it comes to your credit score. 
6. Make upfront payments for insurance. When taking out insurance for your home, car, or pet, choose to make the payment upfront, rather than opting for monthly payment instalments if you can.
7. Avoid debt collection at all costs. Although you might not be expecting the bailiffs round any time soon, any account you’ve opened in the past - no matter how small - may be subject to debt collection. If you’ve forgotten to pay a library fine, or owe school fees, this could appear on your credit report.
8. Consider a ‘credit builder’ credit card. If you have a poor credit rating you wish to improve, then consider getting a ‘credit builder’ credit card. These are designed for people with lower credit scores and will help to gently build your credit score - as long as you pay it off in full each month. 
9. Are you financially linked to someone else? If you have a joint account, mortgage or loan with somebody else (such as a spouse) then you will be linked financially to that person. Should this situation change, you will need to contact the credit reference agency and ask for them to be removed from your individual credit report - this can make a big difference to your overall credit score health. 
10. Check your credit record. Are you aware of what’s been documented on your credit record? Incorrect details - even name and address - can be detrimental to your overall credit health, as can mispayments. Make sure your credit record is correct and up-to-date. 

Check your credit score for free

Are you unsure of what your current credit score is? Check your credit score for free using the UK’s top three most trusted credit reference agencies, by clicking on the links below:

EQUIFAX

EXPERIAN

TRANSUNION

Get started today and experience a healthier and happier credit score!