Credit History on your Credit File

In the financial world your credit history is your reputation. Having a good reputation means that others are more likely to trust you. The same could be said for a good credit history when it comes to applying for credit.

On your credit report your credit history is made up of the credit cards, loans, store cards and mobile phone contracts that you have had in the last six years. Each month the information about all of your credit accounts is passed to Callcredit, and the other credit reference agencies, to update your credit report. Every time you make a payment, miss a payment or settle an account for example, this will be shown on your credit report.

Together all of your credit accounts and account statuses build up your credit history and a reputation about how well you pay your bills. Banks, building societies and lenders use this reputation to decide whether to offer you credit and perhaps give you a better rate of interest.

What is a thin credit file?

If you have never taken out a credit card or store card, the chances are you will have a thin credit file. This basically means that there is very little information held about you to build up an impression of how well you keep up with your credit commitments and unfortunately this will affect you getting credit in the future. You are more likely to get accepted for a credit card with the bank or building society that your salary is paid to, or you have savings with. So take the opportunity to use your credit card for small amounts, such as filling your car up, pay it off each month and you will be building up a good reputation should you need to get more credit in the future.

To see all your credit commitments at a glance and get a free credit score, click here.