Does Moving House Affect Your Credit Score?
Whether you’re moving across the country or overseas, moving is a part of life and we all experience it at least once in our lives. Your address can have a significant impact on your credit score, but not necessarily in the way you might think. While your address is important, moving regularly does not necessarily affect your credit score.
The advantage of having a credit score is that it moves with you, wherever you go. So, while changing address won’t affect your credit score, there are other aspects of home removals that can.
Credit Agencies Use Your Address
When it comes to your credit score and the impact a regular address has on it, there is no need to panic. Your credit score is compiled using your personal information such as your name, date of birth, and (to a far lesser extent) your address.
Credit agencies use your address to:
- Confirm your identity
- Match all your credit information to you
Is There an Address Blacklist?
If you’ve moved houses a lot, I bet you’ve heard the term ‘address blacklist before. The address blacklist is presumably a ‘blacklist’ that, when moving here, will automatically bring down your credit score. However, this is a fabricated notion and completely untrue.
Your credit score is not based on where you live, but rather how you have handled credit in the past. This means that where you live, who you live with, or who lived in your home before you, shouldn’t have an impact on your credit score.
Moving A Lot Can Affect You
Moving house a lot is not only emotionally and physically draining, but it also affects your ability to get credit. Lenders like to see stability in people’s credit reports and moving several times within a short amount of time can signify numerous issues, such as indicating you’ve found it difficult to pay your rent (for example). This may negatively affect you as it may influence their decision to give you credit.
Keep Your Address Up to Date
Credit reference agencies use your address as a way to confirm your identity. However, if your address is out of date or incorrect, it could lead to inaccurate information appearing on your credit report and this can significantly affect your score. What’s more, it can also cause bills to be sent to the wrong property – meaning you don’t make your payments on time. So, it’s essential you keep your address up to date.
To help ensure all your credit information is correct, it is important to ensure all your credit accounts are registered under the correct address. It is really simple to change your address, all you have to do is call your bank or log on to their online app to update your details.
Credit Factors to Consider
The number of addresses that appear on your credit score doesn’t necessarily have an affect on your credit score. However, there are five factors that are important to consider as these can affect your credit score and they are (in order of importance):
- Your payment history
- Your credit usage
- The age of your accounts
- Your types of credit
- The number of inquiries from potential creditors
Moving and Breaking a Lease
If moving means you are breaking a lease on your previous property and not paying what you contractedly agreed to, your credit score may suffer as a result. Firstly, you could be taken to court and this could show up as a public record. And secondly, any unpaid rent will show up as a collections account, damaging your credit score.
You Put Expenses on Credit
One of the most significant ways moving house can affect your credit score is the expense of it. Moving is expensive, there is no doubt about it, and between a deposit on your new place, buying furniture, and paying for a moving truck, it can be tempting to put expenses and new purchased on credit.
However, some of the best advice we can offer you is not to pay for anything you can’t afford with your own money. Save as much money as you can before your move-in date to help cover all moving-related expenses. This will help ensure you don’t hurt your credit score by buying things on credit and then finding it difficult to pay off later down the line.
Moving House and Your Credit Score in a Nutshell
Moving house often can make you look less stable, therefore affecting your credit score as lenders may be wary about lending you money. However, generally, moving houses a lot can only affect your credit score indirectly. To avoid your credit becoming damaged by an upcoming move, follow the steps below and everything should go smoothly.
Prioritise Using Direct Debit
As well-organised as you can be, it is easy to lose documents when you’re moving and, often, this includes bills. So, to avoid missing any of those important payments, be sure to set up a direct debit so the payments will be taken from your account automatically, even when you forget to sort it.
Tell Your Credit Providers You’re Moving
Changing your address as soon as possible will ensure all the accounts you hold are kept up to date. This procedure can be time-consuming because while some companies let you change your address online, others may ask you to visit your local branch to confirm your identity. Be sure to write your address in exactly the same format for each application you fill out as even something as simple as a misplaced number could lead to differing records.
Always Redirect Your Mail
While this can cost money, it is definitely worth doing when you’re moving into a new property as your mail could easily fall into the wrong hands, leaving you subject to identity theft or fraud. Redirecting your mail is a simple process and ensures you don’t miss out on receiving any of your post.
To redirect your mail, all you have to do is log on to the Post Office website and enter your details – it really is that easy! And you can redirect your mail for 3, 6, or 12 months!
Sign Up for the Electoral Roll
Once your settled in your new home, it is important you register to vote as this can have a positive influence on your credit score – showing lenders you’re settled and stable at your new address.
Has This Article Been Useful?
I hope you have found the information in this article useful and that it has answered your questions. Leave a comment below if you’ve found this article helpful!