Am I on a credit blacklist?
If you have poor credit, it may seem impossible to secure a car lease, loan, mortgage or credit card. Every time you apply, your application is rejected and the situation seems to be getting worse. Perhaps you missed a couple of payments on a credit card last year or you let your debt get out of control. Does this mean your name is now on a credit blacklist, suggesting you will forever struggle to secure credit?
Well, contrary to popular opinion, there is no such thing as a credit blacklist. Every time you apply for credit, the lender performs a search on your credit report to determine whether you qualify for the product. Your credit report contains financial and personal information which helps creditors decide whether to allow you credit or not.
“Entries on your credit report only remain for six years, so it is possible to rebuild your credit rating over time.”
Can I find out why my credit application has been rejected?
Each lender has their own criteria that you must meet to be accepted, so if one company rejects you, it doesn’t mean they all will. Either way, a lender’s decision is not based on a credit blacklist of any sort; lenders decide for themselves who to accept and who to reject.
Creditors do not have to tell you why they rejected your application for credit, which can lead to frustration and confusion. If you are refused credit, the first thing to do is obtain a full copy of your statutory credit report for £2 from one of the three credit reference agencies. For the sake of thoroughness, you should obtain a copy from all three if possible, as each report may contain varying information.
“There is no such thing as a credit blacklist. Lenders use the information in your credit report when deciding whether to lend to you.”
What can I do to improve my credit rating?
To increase your chances of being accepted in the future, there are various things you can do. Keep up to date with payments and always pay at least the minimum amount required. Missed or late payments make up a large portion of your credit score, so it’s vital that you always make payments on time.
Make sure you calculate your debt to income and credit utilisation ratios and keep them below 30% where possible. High levels of debt may cause companies to view you as a lending risk because they assume that you will struggle to keep up with payments if you are already using a large portion of your available credit.
While it can seem that you will never regain your financial status, it’s important to remember that entries on your credit report only remain for six years. As time goes on it is entirely possible to get back on your financial feet and secure the most attractive credit deals.
In the meantime, if you have been turned down for a car lease, speak to Eureka. All our car leasing deals are tailored to your individual circumstances to help you drive away in a brand new lease car. Leasing a car with Eureka can help to improve your credit rating while you enjoy the latest, up to date models.