How to check your credit score

Looking to check your credit score to find out whether you're eligible for the best car finance deals? Here's how you can do it

John Evans
Sep 17, 2021

'Credit score', 'credit rating', 'credit file', 'credit history'... There are definitely plenty of terms that ultimately refer to your financial history and your ability to get credit, and one of the key factors used to decide whether you're eligible to take out finance and what interest rate you're likely to get is your credit score.

Whether or not you have taken out finance in the past, you will have a credit score. This score is used as a measure of the likelihood of you making future finance payments on time, based upon your past behaviour. This means that if you've never used finance - or have only borrowed a couple of times - it's harder for finance companies to gauge how likely you are to pay them back - in full and on time.

As a result, if you have only borrowed very little, if anything, in the past, you will have a ‘thin’ credit file. If this is the case you'll probably have to borrow money on a few smaller things to build up your credit history and be in a better position to take advantage of the best car finance deals. Click to find out how to build up your credit history and secure car finance in future.

Credit scores are calculated by three main 'credit reference agencies' - TransUnion, Experian and Equifax - each of which has its own ratings scale. This means you have no single, universal credit score. Instead there are three - each on a different scale. Once you know how each company’s rating system works, it’s clear where you stand with them and companies that rely on their score.

How so? Because you can check your credit scores - and for free, too. Keep reading to find out how. Once you know what your credit score is, check back here to read our story to gauge whether your credit score is good enough to take out car finance.

How can I check my credit score?

We all have the right to see our credit file but, depending on the credit reference agency, the level of access you’re offered will vary and may come at a price. With some agencies, one way to see everything for free - both your score and your report - is to sign up for a 30-day trial and then cancel it before the charging period begins.

Experian offers this option through its CreditExpert service, though you can see your credit score, on its own, for free. If you continue with the offer (access costs £14.99 per month) you’ll also get alerts every time your credit file is updated. Experian claims that this service helps you to improve your score, too, using its personalised tips.

Equifax offers a similar deal, although after the free trial ends, the charge is £7.95 per month. Alternatively, you can access your Equifax score and report for free, for life, through ClearScore - a separate UK-based financial business. 

Meanwhile, you can see your TransUnion credit score and report for free through the agency’s CreditKarma service. This means there are a number of simple ways to check your credit with the three main credit reference agencies.

But what if you don’t want the hassle of contacting each agency in turn? One of the simplest ways to check your scores and reports held by all three agencies is to use Check My File. This is free for the first 30 days and then £14.99 per month thereafter, you can cancel at any time.

How do the credit score bands work?

The three credit reference agencies use different scales for assessing your eligibility for credit. However, with all of these you'll have a specific credit score - a number that represents your exact risk to lenders - and fall into one of the broad credit rating bands. Which scores fall into the respective credit bands differ between the three main agencies, though bands for all of them range from Very Poor to Excellent.

Those in the Excellent band have the greatest chance of being approved for finance and are likely to be eligible for the best finance deals with the lowest APR charges (with APR representing the amount of interest and other charges issued for taking out finance). To take advantage of interest-free credit it's likely you'll need to have a strong credit score.

TransUnion’s ratings range from 0 to 710, while Experian’s vary from 0-999 and Equifax’s scores span from 0-700. The higher the number, the better your credit score and the more likely you are to be approved for finance and to be able to take advantage of the best low-interest offers. They are split up as follows:

TransUnion:

  • 0-550: Very Poor (Any applications for credit are very likely to be turned down)
  • 551-565: Poor (You may be accepted, but expect higher interest rates and lower borrowing limits)
  • 566-603: Fair (Expect to be offered reasonable interest rates, but with limits on how much you can borrow)
  • 604-627: Good (It's likely you'll be approved, but you may not be offered the lowest interest rates)
  • 628-710: Excellent (It's very likely you'll be approved and the lowest interest rates should be available)

Experian:

  • 0-560: Very Poor (It's highly likely you'll be turned down for most credit cards, loans and mortgages) 
  • 561-720: Poor (You might be approved but you can expect to have to pay higher interest rates)
  • 721-880: Fair (Reasonable interest rates may be available, but your credit limit may not be very high)
  • 881-960: Good (Most offers should be available to you, though potentially not the very best deals)
  • 961-999: Excellent (You should be able to take advantage of the best deals, though it's not guaranteed)

Equifax:

  • 0-279: Very Poor (There's a high likelihood that any credit applications you make will be turned down)
  • 280-379: Poor (You may be approved but can expect to be charged high interest rates with low credit limits)
  • 380-419: Fair (You can expect to be offered reasonable interest rates, but are likely to have a low credit limit)
  • 420-465: Good (It's probably you'll be approved, though you may not be offered the best interest rates)
  • 466-700: Excellent (You should be approved for credit, with the best interest rates likely to be available)

How is the credit score calculated?

Your score is based on your past credit performance but even a simple slip such as recently missing a monthly payment can cost you a lot of rating points. Not being on the electoral roll - meaning you are not registered to vote in an election - making too many loan applications, having a county court judgement against you (which may be issued if you've failed to pay a fine, for instance), and being linked to someone with a poor score can also affect your score negatively.

Fortunately, though, that's not all that lenders have to go on. They’ll also look at your file, rather than just take your score at face value, and consider your past dealings with them. They also rely very much on the information you provide on the application form, so be sure to get vital things such as your salary right, because this information is not held on your credit file and could make a big difference to your chances of getting a loan.

Why do I need to know my credit score?

If you’ve never struggled to get a loan, take out a credit card or be accepted by any number of suppliers offering repayment terms, you probably think checking your score is something that only those less fortunate than you need to do. However, lenders work in mysterious ways and as the finance industry becomes smarter with its lending, it pays to know what your scores are in case they’re not as high as you think.

For example, increasingly, lenders charge people a higher interest rate instead of just turning them down as they might have done in the past. It’s why they use the term ‘representative rate’ when quoting example rates in their advertising. More than half of borrowers must be offered the advertised rate but the rest who are also accepted but deemed as not being credit-worthy will probably be offered a much higher one.

This ‘rate for risk’ approach applies when you look for a car on BuyaCar. When you’ve found the car you’re interested in, click on it. At the bottom of the page, you’ll see BuyaCar’s budget calculator. On the last line, you can choose the credit rating that applies to you. It’s a general guide only but you can see how the interest rate and your monthly payment change when you scroll through ratings.

Finally, be aware that if you've never had to borrow money before, it's likely that your credit score is not that high. This isn't because lenders think that you're not capable of paying them back but because they don't have any evidence to go on. Another person who may have taken out a number of loans over the last decade and pay them all back promptly and in full, however, should have a strong score in comparison, as they've proven that they can be relied upon to pay back money borrowed.

 

 

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