8.3m affected by adverse credit in last three years

More than eight million people have had adverse credit in the last three years, according to research by specialist lender Pepper Money.

With nearly half of us (46%) having missed more than one credit repayment, the numbers reflects a reality that many people are grappling with.

What is adverse credit?

Adverse credit refers to someone’s history of failing to keep up with repayment obligations.

It’s a term that can sound a bit daunting, but it simply means that your credit score has taken a hit due to past financial behaviour. This might include late payments, defaults, or insolvency.

Having adverse credit can make it harder for you to secure loans or credit cards, or buy a house, but that doesn’t mean it’ll last forever.

Missed payments

The ongoing cost-of-living crisis hasn’t made things any easier.

People said they’d missed payments for various reasons, such as:

• difficulty managing money (30%)
• reduced income for a time (27%)
• increased expenditure (22%)
• job loss or illness (15%)

The research also found:

• 73% said they’d feel the pinch if monthly bills went up by £100
• 61% are worried about rising costs
• 57% have noticed a drop in their disposable income

Homeownership

Interestingly, about one in three (32%) said they’d thought about moving to save money.

Most people (78%) think getting a mortgage has become harder, while one in five (22%) think it could take over five years before they have enough money to buy a home.

Despite these challenges, 1.76 million potential borrowers with adverse credit plan to buy a house within the next year.

Boost your credit score

A good credit score can open the door to various credit options and help you borrow with a better rate (sometimes saving hundreds of pounds in interest).

Take a look at our guide on boosting your credit score.

If you're losing sleep over your repayments, it might be a good idea to seek free and impartial debt advice.

We can help you get back on course by:

• creating a realistic budget
• helping you with grant applications
• advising you on possible solutions if you’re in debt (some are free and there’s a fee for others)

You can get in touch with us online or give us a call on – 0161 518 8285.