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Equifax Provides Advice on Shopping Around For that new Mortgage deal

According to recent reports, more than 3 million home owners are set to see mortgage repayments rise from anywhere between £30 and £300 each month as fixed rate deals come to the end. As a result, thousands of consumers will be actively shopping around for the next best mortgage deal and with banks and building societies tightening lending rules this could see a number of enquiries being made before the best deal is found. But leading online instant credit information provider, Equifax, is warning that this searching activity may have an impact on a consumer's credit rating if the searches made by lenders aren't logged correctly.

"If consumers are shopping around for new mortgages, the number of searches on their credit file may have a bigger impact on their credit status following the credit crunch" confirmed Neil Munroe, External Affairs Director, Equifax.

"It is standard practice for consumers to shop around for the best credit deals. However, they need to ensure enquiries are logged as 'quotation' (soft) searches rather than 'application' (hard) searches. 'Soft' searches are not taken into account by lenders when they are assessing an individual's credit rating. It's important, therefore, that this type of search is carried out when simply shopping around for deals. At the beginning of a new enquiry a consumer needs to ask 'are you looking at my credit file and what type of search are you conducting?'"

Searches made by lenders when an individual is making an application for a mortgage will be logged as hard searches. They will, therefore, influence the individual's credit rating.

Equifax is also advising consumers to obtain a copy of their credit report, both before they start shopping around for mortgages and after they have completed the process. This will ensure the information held on them is up to date and that their credit rating is going to help them get the best possible deal.

And if an individual's application is declined they should ask the lender why. If the lender says it's because of information supplied by a credit reference agency, they should stop applying for further credit and check their credit file for any adverse information that may be affecting their ability to gain credit.

Munroe concludes, "Getting the right deal will be important for many consumers over the coming months so it's important they take steps to ensure they look the best for lenders. Shopping around is a key part of the process. It's vital, therefore, that consumers make sure lenders only log these enquiries as 'quotation' searches so that their overall credit rating isn't affected."

For just £14.95 consumers can obtain a copy of their Equifax Credit Rating, which includes their Credit Report, instantly, online at www.equifax.co.uk

If you are looking for commentary on this subject, Equifax can provide consumer credit information experts who have extensive experience on this issue.

March 2008

For further press information please contact: Elinor Puzey, Louise Fowler or Cecile Stearn at HSL on 020 8977 9132 / Fax: 020 8977 5200 or Email: louise@harrisonsadler.com