Marcus Sarah & Mark are long term clients of mine. Sarah is a professional who owns her own business while Mark runs their property portfolio. They have a net worth of many £millions so are pretty comfortable.


Sarah has a couple of bank accounts with one of the clearing banks with overdraft facilities. Being a busy professional she, like many of us, spends most of her time looking after her clients and often does not look after herself as well. Sarah, over the years when her overdraft went over its limits, used to have help from her friendly bank manager who would call her up and ask her to transfer funds to ensure she was back within limits. Consequently none of these minor blips ever found their way onto her credit report.


These days, as most of us know, it is a different story. There is very little in the way of human contact with your bank. If you do have a contact number, reaching your manager is only the beginning of the journey. Unfortunately Sarah went slightly past her agreed facility a few months ago and this was detrimental to her credit file. Further inaction exacerbated the situation and reduced her credit rating.


Sarah has now paid off most of the overdraft and brought her account back to a credit situation. Meanwhile her brokers’ approaches to a number of lenders to re-mortgage a few of their properties had hit a brick wall. The majority of lenders credit score their applicants and this directly affects their ability to borrow.


We initiated a clean up of her credit file while, at the same time, approaching lenders that offered a common sense approach, and managed to secure a number of BTL offers.


The moral of this story is that you cannot be too careful these days in monitoring your credit file on a regular basis. I suggest once a year. If you have active bank and credit accounts it is imperative that you stay on top of all of them and keep them within agreed credit limits. Set up a Direct Debit to at least pay the minimum required each month to keep your credit file ‘green’ with a row of zero’s.


The other moral of this story is that if you do have a hiccup like this, then having a good mortgage broker in your camp is the difference between failure and success in achieving all of your financial objectives!