Building a credit history

One alternative way of boosting your rating is taking out store cards or credit cards, using them and paying off the balances on a regular basis. Opening a variety of accounts will speed up the process, but be sure to clear balances regularly to avoid sky high interest charges. And don't fall in to the trap of missing payments and thereby making your situation worse.

It may be worthwhile asking a family member or good friend with a good credit history to co-sign for a small loan or credit card. This will re-establish good credit in your own name.

It takes some time for your new credit history to gain momentum, but it will help prove to lenders that you are reliable and credit worthy.

Another tip is not to keep applying for credit if you have been refused by other lenders. A large number of searches on your credit history can make matters worse, so make an application only after you have confirmed with the lender that you fit the profile of people they lend to. I've never had credit but still been turned down Many people complain they have never applied for any credit - and therefore had no credit problems - yet have still been rejected. Bizarrely, the credit industry feels more comfortable dealing with people who have a track record of paying off credit so you do actually have more chance of making a successful application if, for example, you have taken out a mortgage or loan previously.

This problem is easily solved. Take out a credit card, spend some money on it and pay it off each month. Lenders will now see that you can do this sensibly and will be more likely to lend you money.