Taking out credit
You may want to consider taking out credit from a credit union or getting a loan from a bank to pay for something like a holiday or to replace a household item. You need to think carefully before taking out credit as you may not be able to pay your normal household bills as well as the loan payments. Before you take out credit it is a good idea to do a budget to see if you can afford the monthly payments.
If you do apply for credit the creditor will check your credit report and use the information on your credit report to see if they will lend to you.
You can ask the credit reference agency to put a notice of correction on your report of up to 200 words. Usually credit decisions are made automatically by computer, but if there is a notice of correction on your report, your application will be referred to a person to make the decision.
You need to think carefully before taking out credit as you may not be able to pay your normal household bills as well as the loan payments. Before you take out credit it is a good idea to do a budget to see if you can afford the monthly payments.
Managing Spending
If your mental health causes you to have periods where you find it difficult to control your spending, you can put information on your own credit report to tell lenders about your mental health and how this affects your spending.
Example
Notice of Correction – to help manage spending:
I have bipolar disorder which I am receiving treatment for and have been for many years. Most of the time I am very sensible with money, budget well and pay any debts I have on time, but when I have manic periods I have been known to spend recklessly and apply for more credit than I can manage.
Difficulty Getting Credit
If your mental health led to information being placed on your credit file which is making it difficult to get credit you can add information to your credit file to explain what happened.
Example
Notice of Correction – to explain an issue on your credit file
I am aware that my credit reference file shows that I defaulted on my loan repayments to the bank in October 2011 and that I then received a county court judgment in June 2012. This was because I fell seriously ill around the time of the default and I had an extended stay in hospital. Once I recovered I returned to work and have been repaying this debt as quickly as possible. I have now been repaying the debt for over 4 years and it is almost paid in full. Please take these exceptional circumstances around the default and the court judgment into account when making a lending decision.
Credit Reference Agencies
Find contact details for credit reference agencies in our next steps section.
