October 23rd, 2009 
admin The effect of credit card searches will be discussed next week. Credit card customers would benefit from the introduction of widespread pre-application checking services, a chartered financial planner suggested today (October 23rd).
Martin Bamford said that use of the services, which give people an indication of whether or not they will be accepted for a specific credit card deal without requiring a formal application to be made, would help to eliminate the damage that “searches” cause to credit records.
He also welcomed the fact that the Treasury Committee, an influential group of MPs, will conduct an investigation on the issue at a meeting next week.
Credit card providers commonly check the previous repayment habits of their applicants by conducting a search, a formal check that is then noted on the customer’s record.
The procedure can lower people’s chances of being approved for a credit card, as traces of multiple searches can signal financial distress on the part of the applicant.
However, the searches also penalise customers who shop around for the best deals by making multiple applications.
Martin Bamford, chartered financial planner at Informed Choice, said: “The introduction of widespread pre-application checks would be a great result for consumers so we can all understand precisely what deal we can get before anything arrives on our credit reference file.”
He added: “It is good news that the Treasury Committee is looking into this issue.”
Representatives of all three UK credit reference agencies, Experian, Equifax and Callcredit, will be present at the MPs’ meeting when it takes place on October 27th. Read all post…
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