CrazyCredit explains bad credit ratings
Your personal credit rating is an important factor when applying for any form of borrowing. Potential lenders will use it as a measure of the risk you represent. People with a good credit rating are viewed as a low risk when predicting whether they will repay their debts. People with a bad credit rating represent a higher risk and lenders will either charge them more for their loan to offset some of that risk or even reject their application completely.
A bad credit rating is a subjective term, so there are no hard and fast rules that mean you have one or not. Lenders who offer so called bad credit loans often use their own points scoring system to rate a potential new borrower. They will consider things like your history of loan, mortgage and credit card repayments, the number of other debts you already have and their value, the number of missed payments you have had on existing debts, your employment record and the number of times you have moved home in recent times. Also anyone who has a County Court Judgement (CCJ) recorded against them, particularly for a finance-related issue, will find their credit record marked down.
There are a number of credit checking agencies who, for a small fee, will provide you with the data they have recorded against you. You'll then be able to see the same data that potential lenders are seeing and be able to verify that it is correct. If you have a bad credit record due to mistakes in that data, there are ways of correcting them.
