Help/advice needed with credit rating issue and mortgage application

Minymoo

Until last week I had a fair credit rating. This was because I have only lived at my address for 1 year, 13 months ago I had a late payment on a finance agreement (this was caused by an issue in moving current accounts and was paid within a week, as soon as I was aware but the finance company would not remove it) and I had £25,000 on credit cards which was 75% of my credit card limit. In the last six weeks I have paid off a majority of my credit card bill leaving £9,000 owed and will be paying the rest off in the next couple of weeks. However yesterday my credit rating dropped 53 points with Equifax and is now marked as poor. The reason being is that my payment conduct has gone from good to bad, however there is no specific reason for this. I have always paid my bills on time and have had no problems at all recently that could have affected this. I have raised it with Equifax and they were unable to tell my why this has happened and have raised a query on my behalf. As yet the fact that I paid off a large sum of my credit card bills as well as the finance agreement that caused the late payment, has not been updated on my file but I am expecting this to happen in the next week or two as the credit agencies seem to be a couple of months be hid. Anyway I am meant to be applying for a new mortgage in the next week or two for the house we currently rent and I am really concerned that my credit rating is going to cause issues. I earn over £120,000 a year and the mortgage is for £370,000 and we have a ten percent deposit and all the fees. Has anyone experienced this before and what would you suggest I do to try and resolve my credit rating issue, as I do not think Equifax are going to be able to answer my query as they couldn’t over the the phone? I find it terribly unfair that a company like Equifax can cause such issues for people by altering credit ratings and not being able to explain why. Especially when i am actually in a really good financial position.

Thanks in advance.

Hazzinho

No one sees the scores but you, lenders use their own criteria. Don't worry about the score it means nothing at all, it doesn't take salary info account for instance which is a major factor for any lender. Just make sure all the data is accurate and you are on the electoral roll.

stator

Paying off all your debts in one go would be interpreted as a lucky event, eg you inherited money or won the lottery etc. So it wouldn't necessarily improve your score because it doesn't mean your future conduct will be good.
However as Hazzinho said your Equifax credit score is irrelevent, the bank will not use it. They will get the data from equifax, experian and/or call credit and make up their own minds.
Sometimes it takes a while for credit files to be updated, you may be waiting weeks for all your payments to show.

Thrugelmir

Credit reference data is not kept in real time. Lenders send updates on a monthly cycle. Mortgage lenders may question a sudden improvement in finances. Particularly where it coincides closely with an application for further credit. As the timing will appear too convenient.