Want to know what lenders and employers think of your financial situation? Download these 2 Apps!

We all know what we think of ourselves. But how does the financial world view you? Knowing my credit score was and remains a crucial part of my financial education. I recently downloaded two super easy Apps - ClearScore by Equifax and Experian. These Apps have made it much simpler for me to track my credit score and to see how lenders view me.

How does the world view you?

A bank sees you as a number. This number can change EVERYTHING
We all know what we think of ourselves. But how does the financial world view you? Imagine you are a large bank with millions of customers. If one customer comes to you to request a new credit card, mortgage or overdraft, how can you tell at a glance that this customer will pay  you back, will not run away and is legitimate?

The fastest way a bank can do this is by converting you into a number. This number is called a credit score.

I use the bank as an example here but Lenders include: Utility companies (like gas, water and electricity providers), Employers, mobile phone companies, landlords who use this number to get a snapshot of you before they enter into a contract with you.

How does a credit score work?
Equifax and Experian are one of the largest credit rating agencies. Essentially, business like banks, phone providers (like EE, Vodafone) and the government provide them with data about you that they use to calculate your creditworthiness.

Creditworthiness simply asks the question, how likely are you to pay back a loan?
So Equifax or Experian can look at your bank account, how you spend your credit card, check if you have  registered to vote among other things to create a score for you. 

So when you go to the bank to ask for a credit card, the bank contacts these agencies to see what information they have about you. This can be a soft check (partial review of your credit history with no impact to your credit score) or hard check (full review and can impact your credit score). Typically, it is not a good sign if you have multiple hard checks on your record- especially if you are denied. Lenders see this behaviour as evidence that you are not fit.

Once the bank gets your score, they can choose what interest rate to give you. Generally, the better your score or number, the higher the likelihood that you'll get a good deal.

Why I downloaded ClearScore and Experian
It was important for me to know what these two agencies think of me from a financial point of view. I also wanted to know what information they have about my spending habits and my credit history. Different lenders will use Equifax or Experian to consider any loan or product applications. For you to have a credit history, typically, you'll need to take out credit - a type of loan, such as a credit card or a mortgage. However, these days some lenders can provide products to customers without a credit history.

Equifax and Experian look at exactly the same information but calculate their  scores in different forms. If you wish, you can choose to pay monthly to get detailed information on what they check to create your score. I chose the free option as it gave me all the information I needed.

How to Download these Apps 
Visit GooglePlay or the Appstore
Search for ClearScore or Experian
​Hit Download or Install

A view of Clearscore by Equifax on your App

A simple rule of thumb is the lower the credit score, the less likely you are going to get a loan or the higher your interest payments.

How I am finding the Apps
These apps are easy to download and free to use. Every month they check my spending and refresh my credit score. Last month, Experian picked up that I am on the electoral register and my score increased by 22 points!

For newbies, the app also provides a list of dos and donts to boost your score. You can also check your details on the app if you need it corrected and you can also check your score as often as you want. 

Why should you check your credit score? Here are a few reasons:
- Know what lenders think of you so there are no surprises
- Find out ways to boost your score
- It helps you to be disciplined with debt
- It is super easy to do

Read more The truths I am learning about controlling debts

Be mindful of how often lender makes search - ask for a soft check until you are ready to make a real application.

Click here to learn more.

What if you downloaded the App and have no records
If you downloaded these Apps and there are no records to show for yourself, see the suggestions from Experian that can help you build a credit history. 

A view of Experian on your App