A Helping Hand

It's good to know that there is help available when you need it. Particularly with something as personal as your own finances and debt problems. In this section you will find information about some of the common problems people face with credit, including payment difficulties, declined applications and credit scores.

But the help available to you doesn't stop here, there's lots more useful and easy to understand information throughout the Credit Made Clearer site and also in our Frequently Asked Questions

Whatever type of credit you're applying for, whether it's a credit card, loan or mortgage, they all have one thing in common, the chances of being accepted rely on your credit score.

When you apply for a credit card, the credit card provider will look at your credit rating, credit report and other information to create your credit score. This helps them decide whether to accept your application, what your credit limit will be and in some cases the interest rate you will be charged.

So how can i improve my credit rating?

• Make sure you are on the electoral roll  opens in a new tab - this is so lenders can make sure you are who you say you are.

• It also really helps if you don't apply for lots of things at once such as mobile phone contracts, loans and credit cards. Any applications you make will appear on your credit report as searches. And although credit providers can't see whether you're declined or accepted, a few searches in a short space of time can make you look credit hungry.
• Another helpful tip is to cancel any credit cards you don't use and do your best to pay off any existing debts. Always pay your bills on time, as lenders will be able to see late payments, defaults and County Court Judgements (CCJs).

• If you have never had credit in the UK before, this can often be as problematic as having a bad credit history. Lenders need to see that you have a history of successfully managing credit - staying within your limit and making payments on time.

It's a good idea to get to know your credit report, to find out more visit: Equifax  opens in a new tab or TransUnion  opens in a new tab

Rejection is never nice but when it comes to credit card rejection there's usually a good reason for it. Sometimes a credit card may not be the right fit for you so your application may be rejected. This isn't because someone didn't like you personally; it will simply be because you didn't meet the credit card application criteria required.

Also, bad credit can raise its head at this point so even though you may feel you're on the right path, a credit provider may reject you for something from up to six years ago so it pays to ensure you do all you can to improve your credit rating.

On what basis was my credit card application rejected?

A credit card company normally scores your application, awarding points for any information you provide.

They'll also score the information contained in your credit report. This is very important as it is a record of your past borrowing and shows how well you've managed your repayments in the past. Based on this information, they will approve or decline your credit card application.

If the worst happens and your credit card application is rejected, it's not the end of the world. Just because one credit company rejects your application, another company may accept you. As all lenders have their own criteria, you still might find your perfect match. But take care not to make too many credit applications all at once, lenders don't like this either.

Some credit cards are for high credit scores, others for low so you can save yourself a lot of time and effort by applying for cards more suited to your credit score. Always read any eligibility criteria properly, and answer all the application questions truthfully.

Late payments, debt problems? How to get out of debt

If for any reason you find yourself in a position where you're struggling to keep up with your credit card payments, don't bury your head in the sand and give up, grab hold of the opportunity to do something positive about it.

The best way to get to the root of the problem and solve your debt problems is to talk to someone about it. First, call the companies that you have credit with, in most cases they can offer you help and information on paying off your debt.

If you are a Capital One customer, make sure you talk to us as soon as possible. We have trained advisors who can help you find the right solutions to help you repay your debts. Call our freephone number on 0800 952 4966 (lines open Monday to Friday 8am - 9pm, Saturday and Sunday - 8am - 6pm).

Once you've spoken to someone it's also important to look closely at your finances. How much can you afford to pay? Are you spending too much? Paying whatever you can towards your credit card payments will show you're taking your circumstances seriously.

There are lots of organisations that can help you make sure you are getting any benefits you are entitled to and advise you which debts you should treat as a priority.

Some will also put together a financial statement for you and work out how much you can actually afford to pay to each of the companies you owe money to. Some will also help you talk to these companies about how much you can afford to pay.

There are two types of debt advice organisations:

1. Free, independent, not-for-profit debt management advice

You can get independent advice from any of the organisations below. You can talk to them in confidence and their services are completely free of charge.

• StepChange Debt Charity

  Freephone 0800 138 1111
  www.stepchange.org  opens in a new tab

  The StepChange website will help you:

  • Get tailored advice from their expert debt counsellors
  • Create a personal budget showing your income and outgoings
  • Practical help to make the most of your money

• Citizens Advice

  Find your local branch at: www.citizensadvice.org.uk/  opens in a new tab

• PayPlan

  Freephone 0800 716 239
  www.payplan.com  opens in a new tab

• National Debtline

  Freephone 0808 808 4000
  www.nationaldebtline.org  opens in a new tab

2. Fee-charging debt management companies

You will see these companies advertising more and more on TV and they can be very tempting if you are having financial problems. Remember, you will be paying a fee for their help and advice. This means it will take you longer to pay off your debts.

If you do decide to use one of these companies you should read all of the small print and make sure you understand any agreement or contract before you sign it.

Your credit rating

You can check the information that credit reference agencies have about you. To do this, you will need to write to each agency asking for the information, along with:

• A cheque for £2
• Details of your full name, date of birth, current address including postcode and any other addresses you have lived at during the last six years

Equifax  opens in a new tab | TransUnion  opens in a new tab | Experian  opens in a new tab