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Peer2Peer Finance News | September 26, 2017

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A third of Brits believe there is a credit blacklist

A third of Brits believe there is a credit blacklist
Suzie Neuwirth

ALMOST a third of consumers incorrectly believe there is a credit blacklist used by lenders when considering applications for finance, a survey by Equifax has revealed.

Analysis by the credit scoring and report service identified misconceptions among the public when it comes to applying for loans and credit cards.

The survey identified a slight difference between the UK and London over how savvy people are about what will affect their credit score, with 29 per cent of Londoners mistakenly believing there is a credit blacklist, compared with 31 per cent nationally.

52 per cent of respondents across the country believed their credit score would be automatically affected if they live with someone who has debt problems, compared with 46 per cent in the capital.

Read more: Relief for Bank of England as unsecured consumer borrowing slows

Lisa Hardstaff, credit information expert at Equifax, said previous occupants with debt problems will not affect later residents. Current housemates, partners and family members could only be affected if they have applied for a joint credit agreement, such as a mortgage or credit card.

“Londoners appear to understand some aspects of their credit information better than the national average, but there are still a lot of misconceptions,” Hardstaff said.

“Lenders use the information on an individual’s credit report to determine that person’s ability to keep up with payments. However, there is no such thing as a credit blacklist.

“It’s clear from our research that many people need to take time to understand their credit information and how it’s used. We suggest that anyone considering applying for credit should check their credit report before submitting their application.

“This will enable them to ensure that they understand the types of information that will be used to assess their suitability for new credit, as well as check for any changes that might need to be made, such as updating their electoral registration information.”

Read more: UK consumer credit growth hits 11-year high 
Read more: Fitch upbeat on UK consumer loans despite Brexit