Like most other UK borrowers do you also wish for a debt-free life this Christmas? So what do you do? You hang a bigger pair of stockings and then pray really hard! Guess what! You dont have to rely on Santa Claus anymore to get rid of your debts. You can do it yourself too.

All it takes is a bit of planning and you are all set to start life afresh. Just chalk down a budget and draw an estimate of the amount you will need to pay off all your outstanding bills. Thereafter, apply for a debt consolidation loan and then keep your fingers crossed.

What happened? Your loan application got turned down and your low credit score was considered responsible for it! Well then you can count yourself among those countless UK borrowers who are refused loans for the same reason.

Now let us give you a low down on what credit score is and how it can affect your chances of getting a debt consolidation loan.

Credit score is a numerical figure that is a measure of a persons creditworthiness. It is calculated after taking into account several factors like your repayment ability, your outstanding loans and even the length of your credit history. If you have ever missed any payments or have had arrears, CCJs, or bankruptcy reported against you then your credit history is likely to be blacklisted. This credit report is compiled and maintained by three major credit bureaus namely Equifax, Experian and Transunion. So, arrears in your credit record mean a low credit score, which in turn implies an unimpressive credit history.

What makes things even worse is that now banks are going to run a more extensive background check than ever before. The British Bankers Association is pushing banks to share all kinds of information about customers indebtedness including the amount of time that they have been holding credit and how aggressively they are pursuing new lines of credit. In other words, a person who has had no defaults against his name but carries four or five credit cards, all maxed out will also come under the bankers scanner.

What heightens the pressure on UK borrowers is that most remain unaware of their credit status until their application gets turned down. Moreover, most often these credit liabilities are incurred under unavoidable circumstances like unemployment, divorce or redundancy etc. Every now and then you hear of people being refused loans on account of their bad credit scores. However, you must take heart in the fact that there are a lot of lenders who specialise in lending to people with unimpressive credit reports. These lenders see in you the earnestness to settle your debts and hence extend to you their offers on debt consolidation loans.