Like many people across the UK, you're probably worrying about the long-term impact on your credit score caused by the short-term changes that the Coronavirus has caused. Recent initiatives by a group of Credit Reference Agencies (CRA) outline the steps you need to take to make sure you're credit score isn't impacted in the long-run.
Credit reference agencies Experian, Equifax, and Transunion have implemented the CRA Emergency Payment Freeze Agreement, stating that if a customer comes to a payment arrangement with their lenders or service providers, their credit score will be frozen in place for the next three months.
This means that if you are unable to make payments on bills or debts during this time, your score will not be affected, so long as you come to an agreed arrangement with your lenders.
Possible payment arrangements include payment holidays, payment freezes, reduced payments, and increased credit limits. These will have no effect on your existing credit score.
Additionally, any arrangement made will not be recorded by CRAs, meaning that your current credit score will not be affected after the fact. Once the three months have passed, ongoing reduced payments will have their normal effect.
There is a possibility that a payment agreement could affect your access to credit in future, depending on the requirements of individual lenders.
If you fall behind on payments or make reduced payments without have a pre-agreed arrangement in place, then your credit score will be affected as it would usually.
You can discuss your options with your lenders and service providers individually, or if you have one our more of your lenders or service providers listed in the Tully network, Tully can register for payment relief on your behalf.Subscribe to our newsletter