Most of us understand we need to pass a lot of checks and balances if we want to successfully apply for a mortgage. One of the most influential factors which lenders assess is the applicants credit score; a fact acknowledged by tenants who responded to a recent Experian survey.

In the survey 75% of tenants in privately rented accommodation agreed improving their credit score would give them a greater chance of succeeding in their mortgage application.

Is it even possible to increase your credit score?

Although most tenants do recognise the importance of their credit score and realise they need to increase it if possible, many don't have a real understanding of how they can go about increasing their score.

This is perfectly understandable as most of us shy away from the finer points of finance and the mystique of how credit and financial companies work. Though the inner-workings of finance companies will remain a mystery to most of us, our credit score needn't be.

With it playing such an important role in our everyday lives, everyone should be able to understand what it is and how they are able to influence it.

Why is the credit score so important?

As 75% of respondents to Experian’s survey indicated, a person’s credit score can help secure a mortgage. It can also influence where you bank, which car you drive, the phone you use and even from which company you purchase your household electricity and gas.

All lenders, and most service providers, will use a person’s credit score to determine whether they will advance a loan or provide a service. From this it can be seen our credit score plays a much larger part in our daily lives than many may appreciate.

So, what is a good credit score?

Ah, unfortunately, this is where things become a little murky. No-one can say for definite that a credit score of X will get you an X amount of credit. All companies make their decisions on different criteria and there is no uniform scale.

However, it is safe to assume the higher the score the better and those with a very high score will be offered more financial products at a much better rate than someone with a lower score.

How do I know what my credit score is?

This is easy. Each credit reference agency will provide you with your credit score and they all offer different free and paid options for using their services.

Recently there has also been a slew of websites launched which also offer to provide you with your score and most are free to use.

However, you will find your credit score will differ between agencies though Experian is probably the best known and most widely used.

OK, I know my credit score. Now what?

The chances are you will want to apply for a mortgage at some point in the future. If you have a very high credit score you don't really need to do anything. But, if you are like most of us, you could do with increasing your credit score before you apply for a mortgage just to make sure you pass the lenders qualifying criteria.

You can find out how by reading this article on our blog, but did you know one of the most effective ways of building up your credit score is to simply pay your rent as you have always done?

Credit Ladder's free rent exchange scheme means you could build credit every time you pay rent to your landlord. It's a completely free service and you can read more about it here or register now and start building your credit score without taking out any more credit or paying extra fees.

CreditLadder can help you improve your credit score

If you want to improve your credit position by reporting your rent payments, CreditLadder is the only way to improve your credit score and position across all four of the main Credit Reference Agencies in the UK, namely Experian, Equifax, TransUnion and Crediva. Building up a high credit score has a lot of benefits, including helping you access finance at better rates - this can also help save you money.

CreditLadder also runs a free mortgage application service in partnership with Tembo which will tell you how much you could borrow.

Remember the information provided in this article is for information purposes only and should not be considered as advice.