Ever wanted to know how your credit profile compares to those in other parts of the country? Well now you can, as we have conducted some exclusive research breaking down Britain’s ‘lendability’ by age and by region. In a review of more than 35,000 customers, we found some interesting trends that show which people keep their credit profile the tidiest, and those most in need of a spring clean.
Is your town the credit capital?
People from the Channel Islands are likely to have the best credit profile, while those in the South West are the worst credit performers in the UK. As for towns and cities, Dorchester in Dorset is the official credit risk capital of the country according to our research, with the worst average credit profile of all. At the other end of the spectrum, South West London is the region likely to be favoured by lenders.
Unsurprisingly, younger people are those deemed to have the highest credit risk. Indeed, as the graph below shows, the average credit profile rises for each age group until what lenders see as the Golden Age; 60 to 65.
What’s in a credit profile?
If you’re not sure what a credit profile is or how it works then here’s a reminder. Effectively, it’s a document which tells potential lenders whether you are worthy of credit. This is generally judged by your previous experiences handling credit. Your credit file will show how much money you have borrowed, previous enquiries about borrowing and information about late or incomplete payments, among other things.
This will allow potential lenders to assess not only whether they will borrow money to a customer, but also how much they are willing to lend and on what terms (interest rates, etc). It’s important to bear in mind that there is no such thing as a universal credit profile, and banks and other institutions are likely to rank you differently according to what they look for in a customer.
As a result, if you are rejected for credit with no previous problems it may well be that the decision was based on the bank rather than your own history. Remember, the majority of lenders are doing so to make profit, so someone who pays off their credit card bill in full each month isn’t necessarily an attractive customer.
Nonetheless, it’s still well worth keeping an eye on your credit profile. You can do this by making sure you meet Direct Debit and credit card payments, not borrowing too much (or even too little, as mentioned above!) and not remaining too close to your credit limits.
Where we can help...
Want to apply for a credit card but are worried you’ll be turned down and get a mark on your credit file? We at Confused.com have a handy little tool that can help you work out your likelihood of being accepted without leaving a trace on your credit file. Take a look at our guide to getting plastic recommendations based on your credit profile to find out more or check out the card matcher tool here.
