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Nine things that don’t affect your credit score

Credit agencies take a lot of different factors into account when calculating your credit score. And while each agency may have different criteria to work out that score, certain factors always remain the same. It’s important to know how your credit score works, particularly if you’re intending on taking out a loan or car finance in the future. Unfortunately, there are plenty of misconceptions out there about what affects your credit score. So the first step is being able to tell the difference between fact and fiction. With that in mind, we’ve compiled a list of the most common myths around credit scores and the things that don’t affect your credit score at all.

Your salary/income

Your salary does not effect your credit score

Any information about your salary or how much you have coming into your bank account every month doesn’t make up part of your credit history

So whether you have a high or low income doesn’t matter at all when it comes to calculating your score. 

If you have a high income, you can still have a bad credit score if you have sizable debt or have a history of missing payments. 

Likewise, if you have a lower income, you can have an excellent credit score if you manage your repayments well and keep your debt levels to a minimum.

It may not show on your report, but your income does play a role when you make an application for credit. 

This is because the lender also looks at affordability. So whether it’s salary or savings, it’ll more than likely be part of the overall criteria the lender uses to decide whether to lend to you.

Checking your credit report

You can check your credit report 20 times a day and it won’t ever make a difference to your credit score. 

In fact, checking your credit report regularly is important to ensure it’s up to date, all the information is correct and to understand anything you can do to improve your score.

Soft credit checks or searches

While checking your own credit report won’t affect your score, what can be reflected is searches that have been made by others. 

This can include lenders following an application for credit, mortgage companies, banks and utility companies.

Each time a search is performed it’s recorded on your report for other organisations to see. 

Apply for several lines of credit in a short space of time, and all these searches don’t only look bad, but they’ll likely make your credit score drop too.

A soft credit check or search – often used for quotations or identity checks – on the other hand, is recorded on your report, but only visible to you. 

So this type of search will never affect your score. Here at Hippo Motor Finance, all our initial checks are soft, so you can find a lender without affecting your credit score.

Your bank or savings account

Your savings do not affect your credit score

Your credit report exists entirely for three reasons – to help confirm your identity, to show your history of credit, and to predict your future pattern of using credit. 

That means any accounts that are typically in debit,  such as your bank or savings account, won’t show up on your report.

There’s an exception to the rule, however, and that’s if your bank account has an overdraft facility. As an overdraft is classed as a debt, it’ll show up on your report if it’s in use. 

Your partner/people you live with

Who you live with or are married to doesn’t affect your credit score, nor would it be recorded on your credit report. 

Others can only impact your credit score if you’re financially linked to them. 

For instance, if you share a flat and hold a joint account with someone else for the bills, that person is considered a financial link to you. 

If this person has a poor credit score, it can negatively impact yours. 

Student loans

Your student loans do not effect your credit score

Student loans are not included in your credit report, as they’re deducted from your future income automatically with a fixed percentage after you graduate. 

You also only start paying it back when you are earning over the set threshold. 

The only way a student loan could affect your credit score is if you didn’t repay the loan. 

At which point it could be marked on your report as a default and your score would reflect this.

Your address

One common myth is that living at an address where the previous occupants had a bad credit score will affect your own score. 

It’s only your information that counts when it comes to your credit report, though.

Credit checks only take place on people and not addresses, so unless you have a financial link to the previous occupants, there’s nothing to worry about. 

Distant credit history

The majority of information on your credit report is only held for around six years. If you missed a payment a decade ago, it’ll have since fallen off your report and won’t affect your score. 

Lenders and companies also tend to focus on the most recent information So while a default or Debt Relief Order may stay on your report for several years, the more time elapses, the less important it’ll be when applying for credit. 

Unpaid fines

Whether it’s library or parking, unpaid fines will not show up on your credit report. But if the unpaid fine ends up in court and you fail to pay a County Court Judgement (CCJ) within the allotted time, this will then be documented on your report and can severely lower your credit score. 

What does affect your credit score? 

Now you know the most common things that don’t affect your credit score, it’s important to find out what does. 

Representative Example of Credit

We expect more than 51% of our customers to achieve this rate.

Loan Amount Total Cost of Credit Representative APR 60 Monthly Payments Deposit Amount Loan Term Total Amount Payable
£7,500 £3831 19.1% APR £188.85 £0 60 Months £11,331

All offers are subject to change at any time, you must be 18 or over and finance is subject to status, vehicle availability and terms and conditions apply. We can introduce you to a limited number of finance companies, a commission may be received. Failure to maintain payments may result in termination of your agreement and the vehicle being returned, this could affect your credit rating and make it more difficult to obtain credit in the future. All prices correct at time of publication.

We purchase a wide variety of vehicles from all over the country to ensure the best quality and value for our customers, all of our cars go through a thorough inspection process and if they do not meet our standards we do not sell them. We endeavour to inform our customers (where possible) the provenance of the vehicle they are buying and as such we will always inform you if the vehicle has previously been either an ex fleet or hire car. Should your vehicle be an ex hire/fleet car please do not be concerned as we would never value this vehicle differently when you come to part exchange it and there is no difference to the CAP valuation either.

You should try and estimate the distance you will travel as accurately as possible to try and avoid excess mileage charges at the end of your contract.

All pictures and/or photos and car descriptions on this site are for illustration and reference purposes only and are not necessarily the vehicle on offer. All offers are subject to change at any time and are subject to finance approval and vehicle availability. All prices correct at time of publication. E & OE.

Hippo Vehicle Solutions t/a Hippo Motor Finance is authorised and regulated by the Financial Conduct Authority. FRN 658076. We are a Credit Broker not a Lender and can introduce you to a limited number of lenders. Subject to status and to UK residents only (excl. the Channel Islands). Individuals must be 18 or over. Guarantees and indemnities may be required. We typically receive a fixed commission calculated by reference to the vehicle model, product or amount you borrow, for introducing you to a lender but this does not affect the interest charged on the agreement, all of which are set by the lender. Images for illustrative purposes only. Hippo Vehicle Solutions t/a Hippo Motor Finance is an Appointed Representative of AutoProtect (MBI) Limited for insurance distribution purposes. AutoProtect (MBI) Limited is authorised and regulated by the Financial Conduct Authority. Its firm reference number is 312143. You can check this at www.fca.org.uk

We endeavour to ensure that all information including the specifications and finance availability are accurate. Whilst we make every effort to display correct information we are aware that errors may occur occasionally. We are not able, therefore, to guarantee the accuracy of all information especially when given to us by third parties. If you do require clarification of some information you have seen on our website, please email us at info@hippomotorgroup.com . This does not affect your statutory rights.

We are a broker not a lender and our registered office is Unit 26 Trident Park, Trident Way, Blackburn, BB13NU.