What is a credit score?

Definition of credit score

A credit score is a numerical assessment that financial lenders use to determine how reliable a potential borrower is.

In the UK, this numerical assessment is compiled by consumer credit reference agencies, the most notable of which are Callcredit, Equifax and Experian. Lenders such as companies, banks and loan and mortgage providers use your credit score to determine your suitability for a credit card, loan, car finance, mortgage and more. Government bodies can also access this data when assessing your eligibility for benefits or following up on unpaid taxes.

More information about credit scores

The data that credit reference agencies use to create your credit score includes past credit behaviour, any incidents of bankruptcy or insolvency and information from public sources such as the electoral roll and public records (e.g. court judgments). Your credit score can also affect how eligible you are for particular interest rates. If you have outstanding debts or a history of late payments and defaults, this will likely affect your credit score.