One in five Which? members who have checked their credit history unearthed mistakes, Which? Money reveals today.
With lenders increasingly using credit-scoring systems to decide the rate of interest they charge customers, an inaccurate file can mean either being turned down for credit, or being charged a higher rate of interest.
Which? Money advises people to check their files with all three credit reference agencies annually, or at least before applying for credit.
The three credit reference agencies are Call Credit, Equifax and Experian. Different lenders use different agencies and they don’t all hold the same information, so people need to check all three credit files.
However, the survey of 1,591 Which? online panel members showed seven in ten had never checked their files through a credit reference agency.
People don’t have to pay for expensive online services from the agencies or anti-identity theft insurance, though – files can be checked for just £2 each, or often for free with an online trial.
Which? Money Editor Martyn Hocking said: ‘Checking your credit files is quick, simple and cheap.You can check all three files for a total cost of £6 – definitely money well spent when you consider what you could pay in additional interest if there’s a mistake on your files.
‘You don’t have to pay for expensive options promoted by the agencies, though, and watch out for unnecessary ID theft insurance – you can protect yourself for far less simply by checking your files and bank statements.’
The full article ‘What’s on your credit file?’ appears in the July issue of Which? Money magazine.
The article includes information on credit reference agencies and credit-scoring, costs of obtaining credit files, survey results, case studies and an action plan for people to follow.
Which? Money is published monthly and is available by subscription only. A special trial offer of 2 issues for £2 is available by calling 0800 0321 177.