Arrow Loans Guide to Credit Ratings / Reports

For some, there can be a moment of panic when someone mentions ‘credit check’ as they fear they may be rejected. It can be a relief when the report comes back clear (good to go) and despair when it comes back with a blemished past (which might affect a lender’s decision to lend)

So, what is the credit rating all about?

In a nutshell, it’s a report on you and how you have performed financially. It covers various aspects which allow a lender to see how you have managed your finances in the past. Have you borrowed money before, did you pay it back on time, did you default at any point?

Average UK Credit Score

An average UK adult, with typical circumstances and some credit history would have a Credit Score as follows.


A three star credit rating is typically, what most people in the UK. The majority of lenders will consider a Credit Score of 750 as a reasonable risk and in the absence of other factors. Most will lend money at this level, depending on the information found within your credit report.

Flexible Lending

Here at Arrow Loans we don’t base decisions on ‘good’ and ‘bad’ credit scores, instead we look deeper into the content of your report and base our decisions on affordability.

How Life Events affect your credit score

When you move, many of the stability factors that make up a credit score are affected. The electoral roll also plays an important part in determining your credit score, so when you move house, it’s easy to forget to register at your new address.

One of the major factors in a credit scorecard relates to your stability – it has been proved statistically that the longer you live in a property and the longer you remain in a job, the less risky you are in the eyes of a potential lender.

When many people reach their middle age and have growing children to support through education, their finances tend to get stretched.

Is my Credit Report affected by the area I live?

Public databases such as the Register of Court Judgments and Insolvency Records along with census and survey data are used to estimate the average financial risk in a postcode. Yes, it plays a part.

So what exactly is a credit report?

  • It allows lenders to view your financial history record
  • It allows lenders to make informed decisions
  • It shows any loans, hire purchases, bank accounts, mobile contracts and credit cards etc.
  • It shows any court orders, default accounts, active accounts and settled accounts.
  • It is updated every time a company performs a credit search on you

The financial organisations you deal with, will inform various agencies about your repayment and relationship which are detailed in the credit report and this will affect your credit scoring.

What affects my credit score?

  • Not having any previous financial history
  • Falling behind on payments
  • Not being registered on the electoral role
  • Incurring a CCJ due to defaulting on a loan

Do Multiple Credit Searches affect my rating?

It’s interesting to note that most application scorecards do not take into account the number of credit applications you have made in the past year or so, which debunks the myth that searches affect the ability to get credit.

Credit Report Example

The search itself has no negative impact but the fact multiple lenders may perform a credit search, might indicate a reluctance to lend by others.

Flexible Lending

Unlike many lenders who use algorithms to make loan decisions, Arrow Loans take a broader view of your overall financial situation. When we perform a credit search, we will give you the chance to explain the accounts on your report. We don’t base our decision to lend solely on your credit score. Read our blog here.

Credit Reference Agencies

There are a range of Credit Reference Agencies that are used by different companies. These include

If you are looking to access credit but are worried your credit score isn’t good enough, get in touch.

Phone Arrow Loans

Call us on 0845 066 8880 or fill in our enquiry form, which ever suits you best.