Having bad credit can affect your ability to obtain credit related items. These include credit cards, personal loans and mortgages. There are many everyday items that you might not realise require credit checks, like mobile phone plans.Credit rating refers to your credit worthiness. If you have bad credit, this means that your credit worthiness is poor. A bad credit rating will reduce your chances of being approved for a credit card, a personal loan, and a home loan.

If you have been using credit in the past seven years, then a credit file will have been complied on you. A credit file will contain information like:

- Personal details.
- Credit applications.
- Credit enquiries.
- Overdue accounts information.
- Any defaults in your past.

Defaults can end up on your credit file in a number of ways. These include:

- Not paying bills on time.
- Having utilities cut off.
- Having assets repossessed.
- Going over your credit card limits.
- Defaults on previous loans.

This bad credit information will stay on your credit file for a number of years, affecting your ability to get credit.

You can easily get a copy of your credit file from My Credit File. Depending on how urgently you need the copy, you may have to pay a fee. Be sure to check it closes to ensure that all the entries are correct.

If you do discover errors, report them as soon as possible. You may be a victim of identity theft. Alternatively, there may just be a bill that you have overlooked and forgotten about. Remember to keep track of all credit enquiries and applications so you can confirm them as defaults stay on your credit file for five years.

It isn’t hard to avoid defaults on your credit file. Avoid a bad credit file by:

- If you aren’t able to bay a bill on time, contact the company and advise them. So make an effort to pay all your bills on time.
- Review your credit file regularly to ensure all entries are accurate and there are no fraudulent entries. If there are entries you don’t recognise, investigate the entries to ensure that your identity hasn’t be stolen.
- Remember that a perfect looking credit file doesn’t mean that your application will be successful as companies have other criteria that you will need to meet.

There are options available to you if you have problems with repaying all your credit cards. You can consolidate debt to make it easier to pay off your credit card debt

A credit card balance transfer is one such option. A balance transfer credit card will transfer the owing balance on your credit cards to a new credit card. Many credit card companies provide special offers on balance transfers, such as introductory periods where low interest or even zero interest is applied. With these introductory periods, you could be saving yourself a heap of money. Compare balance transfer credit cards here. If you’re still doubtful, take a look at the credit card calculator and see how much money you could be saving with a balance transfer credit card.

If you save money, you may have less trouble meeting your credit card repayments.

Check out your credit file if your credit application has been declined and find out if your credit history is to blame. Use our credit card comparison page to find a balance transfer credit card that suits you and fill out a credit card application for a credit card that can help you.