Leaving Home

Proving your independence

When you leave home, it is usually because you have decided you want to be independent. But when you apply for credit, the lender will ask you for your previous addresses, sometimes for up to six years, and they will then see the recent credit histories of those people you lived with who have the same surname as you.

Lenders are allowed to take this information into account when deciding whether or not to grant you credit because it helps them avoid lending to a household which is already overburdened and it helps them judge whether or not you will honour your commitments.

Breaking the link

You may be tempted to prove your independence by getting the credit reference agency to break these links with your family, which you can do by asking the Consumer Help Service to create 'disassociations' on your credit file.

But if your relatives have good credit histories, the fact that you are linked to them might help, especially if you are young and are applying for credit for the first time.

However, if you are granted credit you will give permission for the details of the account to be stored with the credit reference agency. And so information about your credit history will be shown when a search is made on one of your family.

If you have had difficulties, for example you've missed the monthly payments on a credit card, you haven't paid back a student overdraft at the agreed time, you're behind on your mobile phone bill, or you've not kept up-to-date with your television rental, this information may affect their ability to get credit.

It will certainly make it more difficult, or even impossible if you end up with County Court Judgments and defaulted accounts, for you to get credit.

The bad news is that this type of negative information stays on your file for six years. The good news is that after six years it is removed from the record whether or not you have paid. But six years can be a long time. So make sure you settle your debts if you don't want them to catch up with you later. If you can't pay, let the lender know as soon as possible.

Because you will receive details of people you lived with at your previous addresses, tell your parents if you are going to apply for your file. If they do not want you to see their information, they should contact the Consumer Help Service first and ask for a 'disassociation'.

Sharing accommodation

You are only linked to people you live with who have the same surname as you and to people with whom you have joint credit. Paying the rent together doesn't count, so you are unlikely to be financially connected to people you simply share a house with, unless you have a joint mortgage, other loan or have all put your names on a credit agreement.

People sharing often have the bills in one name. If it's your name, remember that if your friends leave owing money, the fact that they were morally responsible for part of the debt will not protect you. You will be liable if the company decides to try to recover the debt and any resulting County Court Judgment will be in your name. Registering to vote If you are a student you may want to remain on the Electoral Roll at your family home, or you may decide to register at your new home.

When you apply for credit, include on the application form the address where you are registered to vote. And explain on the application form if your current address is temporary, so that the check can be run on the correct address.

When you apply for credit, lenders will check your name and address on the Electoral Roll. If you have not registered to vote they will need other proof of residence from you. They may even refuse you credit.