What is credit referencing?
Credit referencing enables lenders to make quick decisions when you apply for credit. It's a process that involves both lenders and credit reference agencies like Equifax. Working together, they share financial information about an individual to help lenders assess their credit history and judge their ability to repay future credit. This information is then kept up-to-date through regular updates to the credit reference agencies by lenders and other organisations.
What information is being shared about you?
Lenders will contact Equifax to find out how much credit you have borrowed and what your repayment history has been like. Public information like electoral register data and whether you have any County Court Judgments (CCJ's) for debt will also be shared. Lenders will then use this data to make a quick, informed decision when credit is applied for.
Your information held on your credit report and score will influence the financial products you’ll be accepted for. In simple terms, if a lender views you as being more likely to repay, and less likely to default on a payment, they’ll be more likely to offer you a lower interest rate.
It is important that you check your credit file on a regular basis, especially if you believe your personal information has been compromised or you’ve been a victim of identity fraud to make sure that the information held about you is up to date and correct.