I was excited to hear about a brand-new FREE service from Experian called Experian Boost. It aims to give everyone more control over their Experian Credit Score and potentially increase it straight away.
When did you last check your credit score?
According to a study by Experian over half (53%) of people have never looked at their credit score or looked at it twice or less in the past year. Your credit score is an important part of your financial profile to understand, just like your bank account or savings balance.
Your credit score is key to any financial decisions where you are seeking new credit. It reflects how you have behaved with credit in the past, and how likely you are to repay credit in the future. Your credit score and report will give you a good idea of how lenders see you when applying for a wide variety of products including bigger products like mortgage, loans or credit cards all the way through to lower level commitments such as mobile phone contracts or even your energy bill.
Checking my Credit Score uncovered an issue
I check my credit score and credit history every month and am signed up to alerts from Experian who inform me if there have been any changes to my credit score and report. I recently had an issue with my credit report where my identity was stolen, and a credit account was opened in my name. The perpetrator ordered £3k of products using my name and address, and the debt sat on my credit report.
Through checking my credit report, I was able to discover the credit application and ensure it was reported and then removed from my file. It is so important to regularly check your credit report to ensure all the information is correct and relates to only you. Luckily, I discovered this before I made a credit application of my own and was potentially rejected.
How Is Your Credit Rating Calculated?
Your credit rating is affected by many factors. These factors include personal information including the time at current address and being on the electoral register. Your rating is also impacted by financial factors including amount of credit applications, usage of credit limits and paying agreed credit payments on time. And now you can add in other factors using Experian Boost that could increase your credit rating by up to 66 points.
What is Experian Boost?
Experian Boost allows you to add every day transactional information to instantly improve your credit score for free. Information that can be included are transactions such as transfers into savings or investments. Also council tax payments and even streaming subscriptions such as Netflix, Spotify and Amazon Prime.
You can add this information by connecting your current account to Experian using Open Banking. Experian will look back at the past 12 months of data and look at the total amount going in and out as well as the detail of regular transactions. Once connected (you will need to agree to connect via Open Banking around every three months) Experian will be able to keep this information up to date where it will be used to see if your score could get a boost. Experian are looking for evidence of regular payments and general good money management. This additional information provides a more accurate picture of your ability to repay credit in the future.
Experian Boost will help most people. Research has shown that over half (51%) of people using Experian Boost would receive an instant increase to their Experian Credit Score. Meaning a HUGE 17 million customers could benefit in the UK. The average boost is around 14 points and signing up to Experian Boost won’t reduce your credit score. This could mean that customers move up a credit rating band (from the research this could impact an estimated 12%).
To find out more about your credit score head over to Experian . Add Boost onto your existing Free account or set up a brand new account to access your credit score information.
This is a collaborative post with Experian.