Your credit score is at the forefront of the affordability check. It reveals outstanding debts, your payment history, repayment behaviour, and the like. It is the Central Credit Register that maintains the record of your credit rating. Lenders access your credit report to determine your credibility.
It is crucial to note that the Central Credit Register records your debt information. It does not calculate your credit score. Lenders employ their own mathematical formula to calculate a three-digit score based on information they collect from the Register.
A credit report consists of detailed information about your credit history. Unlike other countries, there is no scoring information in Ireland. Here are the particulars that your credit report encompasses:
- Personal information: your name, address, date of birth and contact details
- Details about your loans, such as the borrowed amount, lenders’ names, payment history, outstanding balance, and any missed payments.
- Information related to guarantee you have recently given for someone else’s loan.
Your credit report will record information related to loans of at least €500.
How to check your credit report in Ireland?
Here is how to check your credit report in Ireland:
- Visit the Central Credit Register website. Click the “start your application” button, fill in the details and submit the application form. If you are not comfortable with submitting your documents online, you can download the application form and send it by postal services.
- To complete the application process, you will need some documents, which include your passport and driving licence, proof of address, which includes a copy of utility bills and bank statement, and a personal public service number (PPSN).
- Once you have submitted your application, it will take a couple of days to complete the process. It generally takes 10 working days to receive your credit report.
Why do lenders use your credit report?
When you decide to take out a loan, your lender will certainly check your credit report to know your past payment behaviour. Your affordability is not determined solely by your income sources. Upon perusing your income statement, a lender cannot know how much debt you already owe and whether you meet your obligations.
This information can be obtained only from your credit report. Even if you have been keeping up with debt payments so far, it is likely that taking on new debt will incapacitate you. A lender will feel inclined to approve your loan application as long as your budget has enough wiggle room to pay off additional debt. It is advised against borrowing if you will end up struggling with paying for essential expenses.
When the borrowed sum is less than €500, your credit report is not checked. Small emergency loans come with a small repayment period. The repayment term lasts for about a month, and the whole amount of debt is paid off in one fell swoop.
If you are applying for loans for bad credit, it becomes essential for a lender to check your credit file. It is likely that your past payment behaviour was not good at all. Of course, they will be sceptical about your repayment capacity. As a result, they will restrict the loan amount and charge high interest rates.
Lenders use your credit report information to calculate your credit score to find out whether you are a risky borrower or not. Lenders check your credit report because of the following reasons:
- Whether payments of your current debts are up to scratch.
- Did you miss any payment or make a default?
- If your debts are in arrears, and if so, how long have they been so?
- How much of your credit limit have you consumed?
What does good credit information mean?
It is vital to have a good credit score to be able to qualify for lower interest rates. Lenders will perceive you as less risky when they find that your previous credit repayments were missed. Falling behind on payments clearly hints at your negligence in your behaviour. Even though your current financial condition is strong, your lender will be sceptical about your repayment intentions.
They will most likely turn down your application, or if they sign off on it, they will charge high interest rates. Lenders calculate your credit score in order to decide:
- Whether they should lend you or not?
- How much money will they lend you?
- What interest rates will they charge?
Just because your credit rating is stellar, it does not mean that it makes approval certain, and at the same time, a poor credit score does not preclude you from getting approval. Your overall financial condition is checked at the time of deciding whether to approbate your loan or not.
Does checking your credit report affect your credit score?
Self-checking your credit report does not affect your credit score. Your credit rating gets affected only when lenders check your credit report. The impact is temporary, though. However, if too many credit inquiries have been made, it will lower your credit score.
Bear in mind that these inquiries are recorded in your credit file. This information is used to calculate your credit score.
As far as self-checking your credit report is concerned, it will not affect your credit rating. This information does not get recorded in your credit file. You can do it as many times as possible.
How long will information remain on your credit file?
All the details related to your credit will remain on your credit report for five years. For instance, if you took out an unsecured loan for two years, this information will be visible to lenders for five years starting from the end of the loan term.
The bottom line
Checking your credit report in Ireland is quite easy. You just have to start the application process by visiting the Central Credit Register. Information on your credit report will remain up to five years.
You should keep checking your credit file from time to time to ensure that you do not have any erroneous details and unidentified accounts.
