{"id":2264,"date":"2026-06-05T20:40:31","date_gmt":"2026-06-05T15:10:31","guid":{"rendered":"https:\/\/www.extramilefinance.uk\/blog\/?p=2264"},"modified":"2026-06-06T16:59:08","modified_gmt":"2026-06-06T11:29:08","slug":"how-to-recover-and-improve-your-credit-score-after-financial-difficulties","status":"publish","type":"post","link":"https:\/\/www.extramilefinance.uk\/blog\/how-to-recover-and-improve-your-credit-score-after-financial-difficulties\/","title":{"rendered":"How to Recover and Improve Your Credit Score After Financial Difficulties"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_52 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a2d13ef4321f\"><span class=\"\"><span style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a2d13ef4321f\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/www.extramilefinance.uk\/blog\/how-to-recover-and-improve-your-credit-score-after-financial-difficulties\/#Ways_to_improve_your_credit_score_after_financial_difficulties\" title=\"Ways to improve your credit score after financial difficulties\">Ways to improve your credit score after financial difficulties<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/www.extramilefinance.uk\/blog\/how-to-recover-and-improve-your-credit-score-after-financial-difficulties\/#To_wrap_up\" title=\"To wrap up\">To wrap up<\/a><\/li><\/ul><\/nav><\/div>\n\n<p>A credit score, a three-digit number that speaks volumes about your past payment behaviour, influences lenders\u2019 lending decisions. Responsible lenders run affordability checks, which include credit score and income assessment. While your repayment capacity is determined based on your current financial standing, it cannot be the absolute benchmark for approval because it is your credit history that sheds light on your commitment and loyalty.<\/p>\n\n\n\n<p>Irrespective of your income, the impact of past non-payments cannot be compensated. Whether you need a small amount or a large one, or whether you put down a small deposit or a large one, you cannot beat the consequences of a poor credit history.<\/p>\n\n\n\n<p>Though there are several <a href=\"https:\/\/www.extramilefinance.uk\/blog\/what-types-of-loans-can-you-get-with-bad-credit-in-the-uk\/\">loans you can get with bad credit<\/a>, a decent credit report is advisable as it helps secure lower interest rates.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Ways_to_improve_your_credit_score_after_financial_difficulties\"><\/span>Ways to improve your credit score after financial difficulties<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Here are the ways to ameliorate your credit score:<\/p>\n\n\n\n<p><strong>#1 Review your credit reports<\/strong><\/p>\n\n\n\n<p>You cannot put in the right effort without knowing your current position.<\/p>\n\n\n\n<ul>\n<li>Obtain a copy of your credit report from all three credit reference agencies. Free copies are available from all agencies once a year. Other times, you will pay nominal charges.<\/li>\n\n\n\n<li>Look for mistakes. Chances are some unfamiliar accounts are appearing on your credit file. Identity theft is common in the UK.<\/li>\n\n\n\n<li>Dispute errors. Credit bureaus will talk to your lenders to tally information before fixing it. It may take a month to get those errors removed.<\/li>\n<\/ul>\n\n\n\n<p><strong>#2 Manage your debts<\/strong><\/p>\n\n\n\n<p>Do you owe money? Make a <a href=\"https:\/\/www.extramilefinance.uk\/blog\/how-can-i-manage-my-debts-with-12-month-payday-loans\/\">debt management<\/a> strategy to protect your finances and credit score down the line.<\/p>\n\n\n\n<ul>\n<li>Create a list of debts. Identify which ones are the costliest. Are there any small loans such as <a href=\"https:\/\/www.extramilefinance.uk\/blog\/how-to-get-fast-loans-from-direct-lenders-in-the-uk\/\">quick loans<\/a> and <a href=\"https:\/\/www.extramilefinance.uk\/loans\/bad-credit-loans.html\">bad credit loans<\/a>?<\/li>\n\n\n\n<li>Try to settle short-term high-cost debts first. They accrue interest by the day. The cost can quickly escalate.<\/li>\n\n\n\n<li>If there are <a href=\"https:\/\/www.extramilefinance.uk\/loans\/bad-credit-loans\/unsecured.html\">personal loans<\/a>, mortgages and auto loans, try cutting back on your expenses to be able to adhere to payments. Downsize your lifestyle if you have to.<\/li>\n\n\n\n<li>Talk to your creditors if your financial condition has hit rock bottom, maybe because you have been laid off. They might revise your repayment plan.<\/li>\n<\/ul>\n\n\n\n<p><strong>#3 Take steps to improve your credit score<\/strong><\/p>\n\n\n\n<p>If your credit score is substandard, you will have to take steps in the direction of credit score improvement. Bear in mind it will take some time to show a significant improvement.<\/p>\n\n\n\n<ul>\n<li>If you have already <a href=\"https:\/\/www.extramilefinance.uk\/blog\/what-is-a-debt-consolidation-loan-and-how-does-it-work\/\">settled your debt using consolidation<\/a> or debt management plans, take a break from borrowing. Taking out another debt will further take a toll on your credit rating. Sometimes, the extent of damage is irreparable.<\/li>\n\n\n\n<li>After some time, use credit builder loans. These small loans are paid back over a duration of six months. Paying them back on time will help improve your credit score.<\/li>\n\n\n\n<li>Credit card limits should not be utilised beyond 30%. Discharge the whole balance within the interest-free period.<\/li>\n\n\n\n<li>If you have any existing debts to be settled, make payments on time.<\/li>\n\n\n\n<li>You can do nothing about old inquiries and defaults. They automatically disappear from your credit file after six years. However, recent inquiries and defaults are more problematic than too-old ones.<\/li>\n<\/ul>\n\n\n\n<p><strong>#4 Handle joint accounts carefully<\/strong><\/p>\n\n\n\n<p>If you have joint accounts with someone whose credit score is not subpar, it will badly affect your credit rating too.<\/p>\n\n\n\n<ul>\n<li>Be careful when you are taking out a joint mortgage with your partner whose credit score is below-average. Being financially associated with such a person will pull your credit points if your partner fails or refuses to make partial payments.<\/li>\n\n\n\n<li>Once your account is settled or closed, you should send a notice of disassociation to stop your credit score being linked to your partner\u2019s.<\/li>\n<\/ul>\n\n\n\n<p><strong>#5 Be careful about old accounts<\/strong><\/p>\n\n\n\n<p>Multiple credit card holders often get some of their cards closed in order not to rack up credit card debt, but bear in mind that it steeply increases your credit utilisation ratio. A high ratio will drop your credit score.<\/p>\n\n\n\n<p><strong>#6 Avoid no credit check loans<\/strong><\/p>\n\n\n\n<p><a href=\"https:\/\/www.extramilefinance.uk\/loans\/borrow-money.html\">Short-term loans with no credit checks from direct lenders<\/a> can be very dangerous. No responsible lender provides these loans. In fact, such a type of loan does not exist at all. No lender can approve your loan application without going through your credit report.<\/p>\n\n\n\n<p>Lenders providing these loans are generally loan sharks. They may trap you into an ongoing cycle of debt.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"To_wrap_up\"><\/span>To wrap up<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Credit score improvement is not impossible, but it is a long process. The aforementioned steps can help you boost your credit rating.<\/p>\n\n\n\n<p><strong>FAQs<\/strong><\/p>\n\n\n\n<ul>\n<li><strong>How long does it take to improve your credit score?<\/strong><\/li>\n<\/ul>\n\n\n\n<ol type=\"1\">\n<li><\/li>\n<\/ol>\n\n\n\n<p>It depends on how damaged your credit score is. Credit score improvement takes time. It may take years. You need to be patient with it.<\/p>\n\n\n\n<ul>\n<li><strong>How can I build credit history?<\/strong><\/li>\n<\/ul>\n\n\n\n<p>If you have no credit history at all, you should start by considering credit builder loans and cards. They come with flexible instalment payment plans. If you clear them on time, you will see the positive impact of your efforts on your credit report.<\/p>\n\n\n\n<ul>\n<li><strong>Does paying off early hurt your credit score?<\/strong><\/li>\n<\/ul>\n\n\n\n<p>Paying off early will slightly dip your credit score, but the impact is fleeting. Closing the loan account shortens your credit history. It could also reduce a variety of credit types you use. Both factors will cause a drop in your credit rating.<\/p>\n\n\n\n<ul>\n<li><strong>Does debt settlement improve your credit score?<\/strong><\/li>\n<\/ul>\n\n\n\n<p>Debt settlement means paying off less than the total amount you owe as a full and final payment. Debt management companies offer this facility to borrowers who face affordability issues. Unfortunately, they severely damage your credit score. You might notice a plunge in your credit score by 100 points. A debt management plan will remain recorded on your credit report for 6 years.<\/p>\n\n\n\n<ul>\n<li><strong>Do utility bill payments improve your credit score?<\/strong><\/li>\n<\/ul>\n\n\n\n<p>Utility bills are not loans, so they cannot help boost your credit score, but utility bill defaults will certainly hurt your credit rating.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>A credit score, a three-digit number that speaks volumes about your past payment behaviour, influences lenders\u2019 lending decisions. Responsible lenders [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":2265,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[361],"tags":[363,362],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.extramilefinance.uk\/blog\/wp-json\/wp\/v2\/posts\/2264"}],"collection":[{"href":"https:\/\/www.extramilefinance.uk\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.extramilefinance.uk\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.extramilefinance.uk\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.extramilefinance.uk\/blog\/wp-json\/wp\/v2\/comments?post=2264"}],"version-history":[{"count":5,"href":"https:\/\/www.extramilefinance.uk\/blog\/wp-json\/wp\/v2\/posts\/2264\/revisions"}],"predecessor-version":[{"id":2271,"href":"https:\/\/www.extramilefinance.uk\/blog\/wp-json\/wp\/v2\/posts\/2264\/revisions\/2271"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.extramilefinance.uk\/blog\/wp-json\/wp\/v2\/media\/2265"}],"wp:attachment":[{"href":"https:\/\/www.extramilefinance.uk\/blog\/wp-json\/wp\/v2\/media?parent=2264"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.extramilefinance.uk\/blog\/wp-json\/wp\/v2\/categories?post=2264"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.extramilefinance.uk\/blog\/wp-json\/wp\/v2\/tags?post=2264"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}