James Daley: Am I a victim of the credit crunch?

I made my first application for a personal loan this week – and was very annoyed to find I was almost immediately rejected. As someone who prides themselves on keeping their finances in good order, I've always thought that I would have a pretty decent credit rating.

I'm not afraid to borrow when I need to – yet my payment record with credit cards and mortgages has been good. And although I've missed the odd card payment along the way – usually because the bank has caught me out by moving the due date – I've always been back on track the next month.

I decided to investigate – and headed to a website called checkmyfile.com, which lets you download your various credit reports on the spot for around a tenner. If you've never done it before, I can highly recommend it – it's a fascinating experience.

The first report I looked at was my public Experian file, which is available to landlords, employers and any other person who might want to get an idea about your credit worthiness, but who is not one of the major lenders. Alarmingly, this gave me a rather paltry score of 634 out of 1,000, which is well below the average of 750.

When I dug a bit deeper, I discovered that the main reason for my poor rating was simply that I hadn't had any new checks on my file over the past year. While I scored highly for being on the electoral roll, and not having any county court judgments, I was effectively being penalised because I had not made any applications for credit.

Fortunately, not many lenders make up their minds about their clients on the back of these rather flaky public reports. And my Equifax and Call Credit reports proved more enlightening. These can only be accessed by around 200 of the biggest lenders in the country, and have all manner of detail about your bank accounts, credit cards, relationships with utility providers and more.

On these reports, my score was up in the 800s – which seemed much more realistic. But with a decent rating, why was I being turned down for a loan?

The truth is, it's impossible to know. Lenders are not obliged to tell you why they turn you down, and although your credit report may give you a clue, it's not always apparent.

After a bit of ferreting around, I discovered that my ex-girlfriend – who had a pretty awful credit record – is still registered as someone I have a financial tie to. This, a credit expert told me, could well have been the reason I was knocked back.

The other, very plausible, option is that I have become one of the latest victims of the credit crunch. Although my credit rating is strong, there are, nevertheless, four missed payments across various credit cards over the past three years. As personal loan providers tighten their belts, and look to cherry pick the very best clients for their books, perhaps they decided that four indiscretions were simply too much for their liking.

After I finished examining my credit report, I discovered a link on the same webpage suggesting some lenders who would be willing to lend to someone with my risk profile. Ironically, Alliance & Leicester was top of the list, in spite of the fact that the Moneyback Bank – an Alliance & Leicester subsidiary – had been the lender who knocked me back in the first place.

In the end, I didn't have too much trouble in finding someone else to take me on, but I learnt a valuable lesson. If you want to be assured of getting credit when you need it, especially in these tough times, you need to keep your record squeaky clean. The slightest indiscretion could be enough to put you in the reject pile.

j.daley@independent.co.uk