When is your credit history described as "adverse"?

Its the credit reference agencies such as Equifax and Experian which gather ( mortgage quotes ) information about you, then process and sell it. Indeed, anyone with an "authorised purpose" (as defined by UK Law) can pay to see your credit file. This includes insurance companies, banks, lenders, any government agency, landlords, employers, and anyone you have requested to provide a product or service to you. 

And youll be astonished what the credit agencies know about you! 

A typical file will have your name and address, Social Security Number and date of ( personal secured loans ) birth. It will also include your current address, whether youre on the voters roll and your and previous addresses. Also details of your current and previous employers, and information relating to your monthly payments on your credit cards, mortgage, hire purchase agreements and any loans you have. Then the file will record information from public sources. Details of any Court Judgements in respect of your financial affairs will all be on file. Finally the file is topped off with records of any other credit applications youve made. (remortgages)

All this information is assembled from two main sources: from financial institutions, building ( life insurance policies ) societies, banks, and other lenders offering credit and lending facilities, and Public Records offices. Quite honestly, the agencies are tracking your credit history from the first day you appear on their computer screens. Big Brother is watching! 

The credit agencies then sell this information to anyone to whom youve applied for credit. Theyll also credit score your track record so that a prospective lender can make a statistical judgment on whether or not to allow you credit. Within this process your credit score becomes key. 

Under the credit scoring system your credit history is statistically measured and awarded scoring points based on your details on file. The higher the points awarded, the better your credit rating. The ( home insurance ) points score measures the probability that credit offered to you will be repaid. The system is based on the principle that its possible to predict your future credit performance by examining your past credit record and statistically comparing that with the performance of other applicants who have similar characteristics. The points score then allows your potential lender to forecast the level of risk and reduce the element of subjectivity in their lending decisions.

So now back to the central question - When is your credit history called "adverse"? (life assurance)

In practice its not the credit agencies but the lenders who decide. Each lender has a lending policy through which they determine the level of credit risk theyll accept. The decision is theirs - ( cheap mortgages ) after all its their money! If your total points score reaches a certain level, then you pass their credit screening. If you dont score enough points, the lender may either refuse your application or offer to lend you a smaller amount than you had asked for or charge you a higher interest rate. But this means that what is acceptable to one lender may not be acceptable to another.  (life assurance)

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