Press Release

WHAT MAKES A GOOD SCORE?

Equifax offers advice as Egg reviews customer accounts to increase rates

www.equifax.co.uk

London, February 12th 2009 - The news that Egg is raising borrowing rates by as much as 5 per cent for more than half a million existing customers - and telling those who cannot afford the increase to go elsewhere - has prompted many consumers to ask the question - 'What is a good credit rating?'.

Leading credit information provider, Equifax, is therefore offering advice on what makes up an individual's credit score. As Neil Munroe, External Affairs Director, Equifax explains, the decision by Egg is indicative of the currently risk-averse consumer credit market. "In the last year we have seen lenders tightening their credit granting criteria quite significantly with the result that many consumers have not been able to get the credit deals they wanted. This goes to reinforce the fact that credit is not a right - and that consumers need to understand what lenders are looking for when granting credit and operating credit card accounts.

"Knowing that a consumer will be able repay the credit extended is obviously the number one criteria. But I think consumers also need to recognise that lenders need to be able to make money as commercial organisations and, therefore, they will also look at customers from a profitability perspective.

"But the latest decision by Egg further reinforces that consumers need to be as well informed as possible about how they look to a lender. Many consumers see the credit process as a complete mystery - something over which they have no control. But that doesn't have to be the case."

Lenders make checks with credit reference agencies to see whether an applicant has kept up to date on repaying their credit. Lenders also use a "credit scoring" system to decide whether or not to lend to consumers - and in some instances - at what price, as well as for on-going account management. But basically, the better an individual's credit score, the better the rate they will get, helping them take advantage of the best deals.

The Equifax credit score works by giving an individual points, based on how they compare with people who pay their credit on time. The more favourably someone compares to the national average, the better their score. Consumers will also be told how likely it is that they will be able to get a loan based on their score. And a 'traffic light' signal helps consumers identify information that might be damaging their score.

The Equifax Credit RatingTM dispels the mystery of credit scores, which Equifax research has revealed remains one of the key concerns for consumers. What makes the Equifax Credit RatingTM so powerful is that it is based on all the credit information used by lenders when assessing applications, and it is available online instantly, providing consumers with a valuable insight into their credit rating.

To obtain your Equifax Credit Rating instantly online go to www.equifax.co.uk. The price is £14.95.

THE EQUIFAX CREDIT SCORE TEST

To help consumers work out how they might score when next applying for credit, Equifax has developed the Credit Score Test.

Questions	Yes	No	N/A
Are you registered to vote at your present address?	10	0
Do you have at least two active credit accounts? Such as a credit card, store card or loan.	10	0
Are all your credit account payments up to date?	15	0	0
Have you missed payments on your credit accounts in the last 2 years?	0	10	0
Do you have any Count Court Judgments or been declared bankrupt?	0	25
Have you ever defaulted on a credit agreement?	0	25
Have you applied for more than two items of credit in the last six months?	0	5
Scorecard
Excellent - Your score shows that you would be a strong candidate for credit	90-100
Good - Your score shows that you have a good chance of being granted credit	70-89
Fair - Your score shows you may have some problems obtaining credit	50-69
Poor - Your score shows you may have considerable difficulties in obtaining credit	0-49

TOP TIPS TO IMPROVE YOUR CREDIT SCORE

1. Ensure you are registered on the Electoral Roll.

2. If possible make more than the minimum payment on credit agreements every month. You will benefit by paying back your debt quicker, paying less in interest and you will build a positive payment history.

3. If you have paid any County Court Judgments, make sure the settlement is recorded on your credit file. If not contact the court to get confirmation details and inform the credit reference agencies.

4. If you have been refused credit, obtain a copy of your credit rating. But DO NOT carry on applying elsewhere. Each search by a lender will leave "footprints" on your credit file, this may look like you are over-stretching yourself financially.

5. If your circumstances have changed then say so. You can place a Notice of Correction on your credit file explaining your financial situation, which a lender will review when accessing any credit applications you make. For example if you were made redundant or have recently divorced and have fallen behind on credit repayments.

6. Avoid carrying a balance that is more than 30% of your credit limit (creditors may view it as excessive debt and that you may not be able to keep up with repayments).

ENDS

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