Does A Financial Association Affect Credit Score?

rartherinv

CRA credit scores are a joke... there is no way they would search a financial link's report as well as yours to come up with your magic number, they just go by a few bits and bobs on your report.

CRA's don't even factor in your income when deciding whether you are a high or low risk borrower (the most important thing a lender needs to know to figure out risk), so you could be on JSA and be a prime borrower in the CRA's eyes with a score of 999 because you are on the electoral roll, you have a credit card and you pay on time, but when you apply for loans the lenders will pee themselves laughing and toss your application right in the bin because you don't make any money. Income is just one example where CRA scoring is completely different to the credit scoring lenders will carry out.

Unlike the CRA's paid for magic numbers, a mortgage company will look at your salary, time in employment, time at address and scrutinise your report closely and investigate your financial links, so whilst it is highly unlikely that your OH's CRA score has been affected by any financial association, it is still really important to file for disassociation on the 3 main CRAs before you apply for a mortgage so that only you can affect your credit worthiness.

Abbymoo

Eee, confusing. Some say yes some say no. I guess there's no point worrying about it. He'll just have to get her removed ASAP and hope, since we've cleared most of our CC's and other credit recently that everything will update soon.

Thanks, everyone

rb10

rartherinv wrote: »

CRA's don't even factor in your income when deciding whether you are a high or low risk borrower (the most important thing a lender needs to know to figure out risk), so you could be on JSA and be a prime borrower in the CRA's eyes with a score of 999 because you are on the electoral roll, you have a credit card and you pay on time, but when you apply for loans the lenders will pee themselves laughing and toss your application right in the bin because you don't make any money. Income is just one example where CRA scoring is completely different to the credit scoring lenders will carry out.

Why do you say this? Is it a guess, or actually based on fact?

My experience - from working in the credit risk department of one of the main high-street banks - is that income is only a small part of the credit scoring process for most products. Far from being "the most important".

Mortgages are slightly different, where it will impact the amount that you are able to borrow (but not, generally, whether you are able to borrow at all or not).

With unsecured products (e.g. bank accounts, credit cards), income is barely used at all when assessing someone's creditworthiness. Statistically it's not a good way of predicting someone's future behaviour.