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6 things you didn’t know could hurt your credit score

credit score on blackboard

July 2016Capital One Essentials

When you apply for a mobile phone contract, credit card or loan - lenders check your credit score to make sure you can afford to pay them back.

A healthy credit score is important because it gives you a greater choice of credit providers to choose from, and also helps you get the best deals available.

We've listed 6 things to watch out for that could be impacting your credit score, along with some useful steps to improve your credit health.

Sharing bills with housemates

Living with someone who has a poor credit rating won't affect your credit score. This is because your credit score can only be affected by people you share a direct financial link with. For example, splitting your rent isn't enough to create a link, but if you open a joint current account to pay bills out of, you would be financially linked.

If you're worried you might be linked to an ex-housemate, you can request a 'notice of disassociation'  opens in a new tab on your credit file from the three largest credit reference agencies. The Debt Advisory Centre offers step by step guidance on how to do this.

Applying for lots of credit cards

Making lots of applications for credit cards over a short period of time is not advisable. This is because each application for a credit card leaves a mark on your credit report which lenders can see. Multiple applications may make you appear desperate for credit, regardless of how responsible you are at managing your credit accounts. This may raise a concern with lenders around whether you’ll be able to repay them.

Make sure you use eligibility checkers before applying for a credit card to find out your likelihood of acceptance before you decide whether to apply or not. Be aware that some eligibility checkers from other credit card providers may only provide a likelihood of acceptance for a credit card rather than 100% certainty.

Capital One's QuickCheck eligibility tool will give you 100% certainty if you'll be accepted for a credit card before you apply, without impacting your credit score. Find out if you'll be accepted for our Classic Card, 34.9% APR Representative Variable.

Withdrawing cash with your credit card

It's generally better to withdraw cash using your debit card rather than your credit card. This is because credit card companies will typically charge an additional fee. You might also end up paying interest on the cash withdrawal, even if you pay it back on time.

When you take out cash on a credit card, the withdrawal is recorded on your credit file. This in itself isn't a bad thing, but just like applying for lots of credit, multiple cash withdrawals might look to a lender like you're struggling financially.

Not registering to vote

The electoral roll is one of the first places credit agencies will check to confirm your identity. If you're not registered to vote it makes it harder for them to do so - and that can make it more difficult for you to be accepted for a credit card or loan.

Registering is free and easy to do. You can register online  opens in a new tab . Your registration may take time to appear (sometimes up to 6 months), so the sooner you do it the better.

Missing payments

This one may not be too surprising - but keeping up with your monthly payments is a great way to protect and build your credit score. It's really important to show your lender that you can make repayments on time, even if it's just the minimum payment rather than the whole balance.

Paying more than the minimum could save you money on interest charges in the long run. Setting up a Direct Debit is a great way to help you do this.

Not checking your credit score

Your credit score can have a big impact on your financial health - so it's really important to know what yours is. If you don't know what it is, how can you take steps to improve it?

Check your credit report today by visiting the three main credit reference agencies; Equifax  opens in a new tab , Experian  opens in a new tab and TransUnion  opens in a new tab . Each offers a free option – but remember to cancel any subscription if you do not wish to keep it as sometimes a charge can be applied.

Check if you'll be accepted

Try Capital One QuickCheck today to know if you'll be accepted, so you can apply with confidence.

Disclaimer: Capital One takes no responsibility for content that appears on websites outside of owned properties, the content is appropriate and intended to offer support at the time this article was published.