What is a bad credit score?

illustration of What is a bad credit score?

Whenever you apply for credit, your credit history is analysed by the potential lender to get an idea of how likely you are to pay back the money on time and in full. For example, when you apply for a mortgage, the mortgage lender will look into your credit history to understand how you’ve behaved with credit in the past. Your credit score can be good or bad depending on what’s in your credit history.

In this Guide, you’ll find everything you need to understand what a bad credit score is, what a good credit score is and lots of links to other useful information if you’re worried about your credit score.

What is a bad credit score or a bad credit rating?

The lower the credit score number the worse your credit is. In the UK, having bad credit can impact how many lenders are willing to give you a credit card, mortgage or bank loan. 

A bad credit score with Equifax is under 379. A ‘Poor’ credit score with Equifax is 280-379, and a ‘Very Poor’ credit score is under 279. TransUnion categorises a poor credit score as being between 551-565, and a ‘Very Poor’ rating is 0-550.  A very poor credit score on Experian is between 0-560, and a poor credit rating is between 561-720.

What is a credit score?

A credit score is a three-digit number given to you by a credit reference agency. A credit reference agency are companies like Experian, Equifax or TransUnion. A credit score is used to judge someone’s creditworthiness. The higher your score, the better you look to potential lenders. 

A credit score is based on your credit history. Your credit history contains the number of open accounts you have, your total number of debt, repayment history. Lenders and banks use credit scores to judge how likely it is that you can repay loans on time.

Find out how to find your credit score in our Guide: How to find out your credit score. 

Is my credit score good or bad?

Your credit score will be on a scale that goes from ‘Very Poor’ to ‘Excellent’. If you’ve had issues with credit in the past (like a missed or late payment), your score will probably be at the lower end of the scale.

Your credit score is worked out by looking at your credit history. Whether you have a good or a bad score will depend on things like: 

  • Do you have any loans, debt or credit cards?

  • Are you linked to anyone else financially?  

  • Are you on the electoral register? 

All of this info is used to create a score. If you have a good history with credit, you will have a higher score. Things like missed payments on your bills can decrease your credit score.

Lenders consider a number of different factors when deciding if they’ll offer you a mortgage, a credit score is important. A low credit score might mean some lenders won’t give you one. But specialist lenders are more likely to offer you a mortgage because they’ll look at your situation in detail. This means they’re more likely to get the bigger picture of you as a person, rather than refusing you a mortgage based on your credit score alone. 

How your credit score is categorised will depend on which credit reference agency you are checking with. Each agency categorises a good or bad score differently. The table below shows how these differ across the three main credit reference agencies in the UK. 

Experian Equifax TransUnion
Excellent 961-999 466-700 628-710
Good 881-960 420-465 604-627
Fair 721-880 380-419 566-603
Poor 561-720 280-379 561-565
Very Poor 0-561 0-279 0-550

Credit scores aren’t fixed. They change over time. And there are many ways you can increase your score before you make a mortgage application. 

Read more in our Guide: How to improve your credit score before you apply for a mortgage.

What are the credit categories?

Each credit checking agency uses a different numerical range to determine your credit score. This means you’ll have a different credit score depending on which credit checker you look at. Although different credit agencies have different ranges, they usually have five categories for credit scores. The categories for credit scores are: excellent, good, fair, poor, and very poor. 

In the UK, there are three main credit reference agencies. They all have different ranges for working out your credit score: 

What is the lowest credit score?

Zero! Most people with a 0 credit score are people who haven’t built up any credit history yet. There’s lots of reasons why you might not have a credit score yet. Maybe you haven’t opened any kind of credit in your own name yet, maybe you still live at home with your parents so haven’t needed to put a bill in your name. 

How bad is my credit rating?

When you check your credit rating, if you have a number that means your credit rating is in the ‘Very Poor’ category, then that either means you’ve had credit issues in the past that’s caused your score to be low, or, it could also mean that you don’t have a rating yet and therefore your credit score is 0. 

If you have no credit history, it means you’ll have a credit rating of zero, which is the same as having a very poor credit rating. If your credit score is zero, you’re essentially ‘invisible’ to lenders and credit referencing agencies. 

How to improve your credit score for a mortgage

There are lots of ways to improve your credit score if you’re worried it’s low. Here’s a few ideas of some quick wins to improve your credit score:

  1. Check you’re on the electoral register. This is easy to do and can make a difference to your credit score. Sometimes, your local council has an old address for you, and things like not having the correct address can make it harder for the credit reference agencies to verify your identity, which can weaken your score. Check your address is correct now on the gov.uk website

  2. Check your credit history on checkmyfile. Checkmyfile is a multi-agency credit checker. It’s the most thorough way to check your credit because it shows you the information that four major credit reference checking agencies have on you. This means you can get a clear view of your credit and also be able to see if anything doesn’t look right. 

For more detailed information on how to improve your credit score, read this full Guide: How to improve your credit score before you apply for a mortgage

The main thing to remember when you apply for a mortgage is that lenders want to see you’re able to pay them back. When assessing your mortgage application, they’ll try to predict how you’ll behave with the money they lend you. They do this  by looking at your past behaviour with credit. They’ll analyse your credit history, your assets and debt history. This might include how many mortgage applications you've made, how much you owe, what credit you've had and whether you paid it off on time. 

Other quick wins to improve your chances of getting a mortgage are: 

  • Make sure you’re registered to vote

  • Make sure you pay your council tax

  • Set up regular credit repayments and set up direct debits for fixed monthly costs to show your reliability will all help boost a very poor credit score range.

What is the best credit card for poor credit rating?

A credit card for bad credit can help you build your credit score. If you want to enhance your credit score and raise it from a ‘poor’ rating to ‘excellent’, there are credit cards designed to help you. 

Even if you’re in the lowest credit score bracket, a credit card is a good place to start building up your reputation for credit reliability.

The best cards for bad credit are ones where you spend money up to a certain limit, and pay back what you borrow on time, just like normal credit cards. But the most suitable ones for bad credit have low credit limits and high interest rates

Although there are many different types of credit cards available, if you have a very poor credit score range, you can opt for a credit card for customers with bad credit. If you use this card to repair your credit history, you’ll increase your credit score over time. 

Here’s a few bad credit credit card options:

  • The Aqua Classic Card. This card is designed for people who have bad credit and want to improve their credit score. It has a spending limit of £1,200 and an interest rate of 37.95%

  • The Barclaycard Forward Card. This card is also designed for people with a bad credit rating, who want to improve their credit score. It has a spending limit of £1,200 and an interest rate of 33.9%.

You should always be really careful when you take out a credit card for this purpose. Especially because the best credit cards for bad credit have higher interest rates, so if you miss a repayment, you could easily end up losing money and negatively affecting your credit score even more. Make sure you only borrow what you know you can pay back, and always pay back the full amount on time. And remember that it does take time to build a credit score up, it isn’t a very quick process.   

Another thing to remember is that you should be careful applying for too many credit cards or too many forms of credit at one time. It can make it look like you’re overly reliant on credit, which would defeat the purpose of improving your bad credit score. 

How does a credit score affect your mortgage?

When you apply for a mortgage, the lender checks your credit history to make a decision. Your mortgage application is more likely to be successful if you have a good credit score. A bad credit score means less lenders will be willing to lend to you. 

Your credit score and history will affect your monthly mortgage repayments. Generally, the poorer your credit score, the more you will have to pay. Or, a lender will ask you to put down a higher deposit. Read more about this in our Guide: How to improve your credit score before you apply for a mortgage. 

If you have a low credit score, it’s a great idea to work with a specialist mortgage broker because they have access to specialist mortgage lenders who will be in a better position to give you a better deal with better mortgage rates than most lenders. Get in touch if you need a specialist mortgage broker, we’re experts in bad credit mortgages. It’s all we do. 

What is an average credit score in the UK?

There isn’t an average credit score in the UK, but there is an average credit category. Most people fall into the ‘Fair’ credit category, which is the credit equivalent of ‘average’. 

The average credit category for Equifax and Experian is the ‘Fair’ category. TransUnion's average credit score falls into the ‘Good’ category but it's very similar to other credit reference agency’s ‘Fair’ category. 


The average Equifax credit score is 380 and this is in the ‘Fair’ credit category. With a credit score in the ‘Fair’ category, you can be offered reasonable interest rates but are likely to have a low credit limit.


The average Experian credit score is 759. The 759 credit score falls into the ‘Fair’ category. With this credit score, you can expect to be offered reasonable interest rates.  With a ‘Fair’ credit score, you will probably have a low credit limit. 


The maximum credit score possible with TransUnion is 710. The UK average credit score on TransUnion is estimated to be 610. The 610 credit score falls into the ‘Good’ category and means you’re likely to be approved for credit. With a 610 credit score, you might not necessarily get the best interest rates.

What is a good credit score?                            

Whether you have a ‘Good’ credit score depends on which credit reference agency you check your credit score with.The agencies all use different numerical ranges to categorise your score. The higher your credit score, the better it is. A good credit score is a high credit score.

For example, you might choose to find out your credit score from ClearScore. Your ClearScore rating is the same as your Equifax rating because that’s where they get the data from. So, a good credit score on ClearScore and Equifax begins at 420. 

Equifax’s ‘Good’ category is a score of 420-465 and a score from 466-700 is ‘Excellent’. With a ‘Good’ credit score, you’re likely to be approved for credit but might not have the best interest rates. With an ‘Excellent’ credit score, you’re very likely to be approved for competitive credit offers and most mortgages.

The maximum credit score on TransUnion is 710, and a ‘Good’ score is between 604-627. An ‘Excellent’ score on TransUnion ranges between 628-710. Experian has the highest credit range at 999. A ‘Good’ credit score on Experian ranges between 881-960 and an ‘Excellent’ score is 961-999. With a good credit score, it’s highly likely you’ll be accepted for a mortgage from most mortgage lenders. 

Read more about this is in our Guide: What credit score do I need to get a mortgage?

What causes a good or bad credit score? 

Having good credit or bad credit is affected by lots of different factors. Use this list for some ideas about what factors cause a bad credit rating:

8 causes of a bad credit rating

  1. Having no credit history
    If you don’t have a credit history, credit reference agencies will have no information to use to judge your creditworthiness. You might not have a credit history if you’ve never taken out a credit card or any kind of loan. Younger people tend to have no credit history because their parents are usually financially supporting them.

  2. Failing to stick to the credit agreement
    Part of your creditworthiness is being seen as trustworthy. Making late payments, missing payments or paying less than required by your credit agreement will be added to your credit history. By being consistently unreliable with payments, your credit score will be classified as ‘Very poor’ or ‘Poor’.

  3.  Declaring bankruptcy
    Declaring bankruptcy will negatively affect your credit rating. Being declared bankrupt will stay on your credit report for six years. Bankruptcy means being unable to repay your outstanding debts. For more definitions of different financial and mortgage-related terms, check out our glossary.

  4.  Choosing the wrong credit card
    A credit card can either improve or ruin your credit rating, so you need to choose a credit card wisely. Choose a credit card which has a limited credit limit and interest rates that you can handle. 

  5.  Being the subject of a County Court Judgement (CCJ)
    A County Court Judgement (CCJ) is a type of court order in England, Wales and Northern Ireland. A CCJ will be registered against you if you fail to repay money you owe. A CCJ can affect your credit rating for six years. If you are issued with a CCJ then try to sort it out as soon as possible. Pay the full amount of the CCJ within one month and get a certificate from the court to say you’ve paid the debt. For more definitions of different financial and mortgage-related terms, check out our glossary.

  6.  Only paying the minimum every month
    Avoid paying off the bare minimum when it comes to your credit card. Paying more than the minimum means you will spend less on interest and can improve your credit score.

  7. Identity theft
    Make sure to protect your credit card against fraud. You can make your credit card extra secure by setting up an email or text alert which is triggered every time a transaction takes place. Fraudsters don’t care about your perfect credit rating and will run up huge bills and damage your credit score.Secure online banking can also be risky. Make sure to regularly monitor your banking transactions and quickly cancel your credit cards if you see anything suspicious.

  8.  Using an Individual Voluntary Arrangement
    An Individual Voluntary Arrangement (IVA) is a repayment agreement. An IVA is made between a borrower and lender when they are unable to pay their debts. An IVA will be kept on your credit reference file by credit reference agencies. Creditors will check your credit rating on your credit reference file before agreeing to lend to you. IVAs are also kept in a public register called the Individual Insolvency Register. A creditor might check this register. Details of your IVA will stay on the register for the length of the IVA. They will be removed three months after the IVA has ended. For more definitions of different financial and mortgage-related terms, check out our glossary.

What causes a good credit rating?

A good credit rating means having a high credit rating. The best credit rating you can have from the main UK credit reference agencies is their maximum score:

  • ClearScore and Equifax’s credit scores are the same and the highest score is 700. 

  • The highest and best possible credit score on TransUnion is 710. 

  • Experian’s best possible credit rating is 999.

5 causes of a good credit rating

  1.  Paying your bills on time
    Payment history is the most important factor when making up your credit score. Paying your bills on time every month is crucial to having a good credit rating.A way to make sure your bills are paid on time is by setting up a direct debit. Once you set up a direct debit, you don’t have to worry about remembering to pay the bill. With a direct debit, money will be taken from your account on a certain date to pay the bill. Just make sure that you have enough money when setting up a direct debit. A good idea, would be setting your direct debits on/ near your payday.

  2. Making sure your personal details are correct 
    Mistakes happen and you can end up with inaccurate information on your credit file. We recommend using checkmyfile to get a thorough look at your credit history so you can see what information is held about you, and if all that information is correct. Our guide, checkmyfile Explained, explains how to use checkmyfile, and the benefits.

  3.  Limit new credit requests
    Limiting the number of times you ask for new credit will reduce the number of hard inquiries into your credit file. Hard inquiries stay on your credit report for two years but their impact on your credit score reduces over time.

  4.  Living at the same address
    Lenders often prefer it if they can see you’ve lived at one address for a long amount of time. So if you’re planning on applying for a mortgage, consider how long you’ve lived at your current address. Or maybe plan to stay in one address for a few years before you apply. 

  5.  Not using all your credit
    Using your credit sparingly causes good credit. Credit utilisation is essentially how much of your available credit limit you use. For example, if you have a credit limit of £3,000 and you’ve used £1,500 of that, your credit utilisation is 50%. Using half of your credit limit looks good to lenders. Using less of your available limit is seen positively by lenders and increases your credit score. If you can, try to use 25% of your credit score or lower.

Does a bad credit score mean you can’t get a mortgage?

No. Having a bad credit rating doesn’t mean you can’t get a mortgage. A lower credit score can make things harder, but it doesn’t make homeownership impossible.

For example, if your Experian credit score is in the ‘Poor’ category, there is still a chance of being approved for credit. Experian’s ‘Poor’ category ranges from 561-720’, which has a bit of a flex in it. 

It’s likely that most mortgage lenders won’t want to lend to you if you have a ‘Poor’ or ‘Very Poor’ rating, but there’s still lenders who will. 

You could be asked to pay a high-interest rate and have a low credit limit. Or, you could be able to get a mortgage offer from a specialist lender who is willing to look at mortgage applications on a case-by-case basis, rather than just a simple ‘Computer says no’. To get in touch with specialist lenders, you need a specialist mortgage broker. Get in touch and we will match you to the perfect mortgage broker for you. 

Go to our page Bad Credit Mortgages to find out what options you have if you have a bad credit score or have had credit issues in the past. 


Our Mortgage Experts are fully-qualified with experience in bad credit, self-employed and complex mortgages. They have a proven track record of getting mortgages for people who’ve been rejected elsewhere.

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