What is a good credit score?

Unfortunately, there isn’t a simple answer for ‘what is a good credit score?’ Instead, there are three answers, because there are three different credit reference agencies in the UK, who each have their own credit score systems. 
 
To help you figure out whether you’ve got a good credit score, we’ll fill you in on all three. 

Unfortunately, there isn’t a simple answer for ‘what is a good credit score?’ Instead, there are three answers, because there are three different credit reference agencies in the UK, who each have their own credit score systems. 
 
To help you figure out whether you’ve got a good credit score, we’ll fill you in on all three. 

Anelda Knoesen
From the Money team
4
minute read
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Posted 13 OCTOBER 2021

What is a good credit score in the UK? 

While we’d like to give you a specific figure that magically guarantees your approval for credit, it’s not as simple as that. That’s because the three main credit reference agencies (CRA) in the UK all score differently, based on past financial behaviour. 
 
To give you an idea of what a good or bad credit score is for each CRA, we’ve put together a handy guide:

Experian

Grade Score
Excellent 961-999
Good 881-960
Fair 721-880
Poor 561-720
Very poor 0-560

Equifax

Grade Score
Excellent 811-1,000
Very good 671-810
Good 531-670
Poor 439-530
Very poor 0-438

TransUnion

Grade Score
Excellent 628-710
Good 604-627
Fair 566-603
Poor 551-565
Very poor 0-550

These credit score ratings are accurate at the time of publishing on 13 October 2021. 

You can check your credit score for free by using our credit report tool. For a fee, you can also request a more detailed report from any of the three agencies directly. 

Why is my credit score important? 

Having a good credit score matters because it helps lenders decide if they should approve your application for credit. 
 
If you have a blemish-free credit record, you’ll have access to a greater choice of financial products and could benefit from low interest rates on loans, mortgages and credit cards. This can make it much easier to manage your debts. 
 
If you have a bad credit score, however, you may still be approved for credit, but your choices will be limited and you’re likely to be charged higher interest rates. If your record is littered with unpaid debt or you have a County Court Judgment (CCJ), you could be turned down for credit altogether. 

How a credit score is calculated 

Credit reference agencies calculate your credit score based on several factors, including: 

  • Your payment history – if you’re late with a payment or miss one altogether, it will be marked on your credit file. This can lower your score for up to six years. 
  • Applications for credit – every time you apply for credit, a hard search will be carried out on your credit report. This leaves a mark on your file. If you make lots of applications in a short space of time, it could have a negative impact on your score. 
  • Length of credit history – lenders like to see a long track record of stability, with at least one of your credit accounts being held for several years. This shows you’ve been trusted by another lender for a long time. Having no credit history at all can give you a low score even if you’re responsible with money, because lenders don’t have any concrete evidence of your creditworthiness. 
  • Past debts and bankruptcies – lenders will be less willing to let you borrow money if you’re declared bankrupt, you enter into an Individual Voluntary Arrangement (IVA) or you have a CCJ against you. 
  • Your financial associates – the credit history of someone you have a joint bank account, mortgage or loan with can impact your own credit score. 

How to get a good credit score

If your rating isn’t as high as you’d like, the good news is there’s a number of ways you can improve your credit score to boost your chances of success with potential lenders. 

✓ Check and correct any mistakes on your report, such as incorrect names, addresses and credit applications. 

✓ Spring clean your finances and make sure all your monthly bills are paid on time. You can do this by setting up Direct Debits. This way, you’ll avoid any bad marks for late payments. 

✓ Make sure you’re registered on the electoral roll as lenders use this to confirm your identity and where you live

✓ Close old accounts – having fewer lines of credit open looks better to lenders, as long as the ones you keep are well-managed. 

✓ Don’t apply for too much credit in a short space of time. You can find out the credit cards you’re most likely to be accepted for by using our eligibility checker without it harming your credit score.

✓ Don’t use too much of the credit available to you. Keeping your credit utilisation ratio low may be helpful if you want to apply for a mortgage or a loan.

✓ Always try to make repayments on time. 

✓ Consider a credit builder card if you have poor or no credit history so you can slowly build up your credit score. As with any credit card, it’s important to pay off what you owe, and if possible, in full each month. 

It’s important to know that, when you first get a credit card, your score may drop temporarily. However, as long as you manage your card well, it can then help boost your score in the long term, as long as you pay off what you owe each month and on time. 

Find out more about building your credit score.

Why is having a good credit score so important?

Having a good credit score matters because it helps lenders decide if they should approve your application for credit.

If you have a blemish-free credit record, you’ll have access to a greater choice of financial products and could benefit from low interest rates on loans, mortgages and credit cards. This can make it much easier to manage your debts.

If you have a bad credit score, however, you may still be approved for credit, but your choices will be limited and you’re likely to be charged higher interest rates. If your record is littered with unpaid debt or you have a County Court Judgment (CCJ), you could be turned down for credit altogether.

What affects your credit score?

Credit reference agencies calculate your credit score based on several factors, including:

  • Your payment history – if you’re late with a payment or miss one altogether, it will be marked on your credit file. This can lower your score for up to six years.
  • Applications for credit – every time you apply for credit, a hard search will be carried out on your credit report. This leaves a mark on your file. If you make lots of applications in a short space of time, it will have a negative impact on your score.
  • Length of credit history – lenders like to see a long track record of stability, with at least one of your credit accounts being held for several years. This shows you’ve been trusted by another lender for a long time. Having no credit history at all can give you a low score even if you’re responsible with money, because lenders don’t have any concrete evidence of your creditworthiness.
  • Past debts and bankruptcies – lenders will be less willing to let you borrow money if you’re declared bankrupt, you enter into an Individual Voluntary Arrangement (IVA) or you have a CCJ against you.
  • Your financial associates – the credit history of someone you have a joint bank account, mortgage or loan with can impact your own credit score.

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