Why you’re suddenly being denied credit

Have you found you’re suddenly not getting approval for credit applications? Confused as to why your credit score is falling when you thought you were on top of your finances? There are any number of things that could be affecting it. But no need to panic. You can check your Experian Credit Score to see if it’s lower than you thought. If it is, these tips aim to help you find what could be unexpectedly hurting it.

Have you moved recently?

Moving house can be a pain – it’s stressful, exhausting and expensive. But it can also hurt your credit score. If you’ve changed your address but not updated this on the electoral register, this could have a negative impact on your Experian Credit Score. Make sure your details are up to date to avoid any unnecessary drops.

Financial associations

So, you’re doing everything right, but still not getting approved for credit? It might be time to blame someone else. (Doesn’t that feel good?) Due to something called a financial association, another person can negatively impact your chances of being approved for a loan, mortgage or credit card.

Financial associations happen if you’ve applied for a joint mortgage or opened a bank account with someone. It’ll also be the case if you act as someone’s guarantor or receive a joint County Court Judgment. Financial associations appear on your Experian Credit Report, so lenders may take this information into account when assessing your application. You can request to have financial associations removed from your credit report, if you no longer hold active accounts with the other person.

Credit card balances

Paying off your credit cards every month is a good thing. But better still is paying them off and then keeping the balance low.

Repeated credit searches

Simply applying for credit can have a negative effect on your score. If lenders see repeated attempts to secure financing over a short period of time, they may see this as a sign of desperation and decide against extending you credit. Try using eligibility tools to see how likely you are to be accepted for loans, mortgages and credit cards before you apply. These searches will not affect your score.

Experian is a credit broker not a lender

Closing an old account

This may seem odd. Closing an account that’s been paid off feels like it should be a good thing. However, if that’s your oldest account, shutting it down will reduce the average maturity of your accounts. This can be viewed negatively by lenders.

A forgotten account

Another thing that could be pulling down your score is a long-forgotten account. Is there a card somewhere you no longer use, stuck down the back of the sofa, perhaps? If it’s in arrears, even by a small amount, this could be hurting you. Take a moment to ensure you’re on top of all your accounts.