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Credit scoring is a mathematically based technique used by many of the largest financial institutions to assess lending risks by statistically analysing individuals' personal details and credit histories.
The technique calculates the probability that the loan will be repaid and, based on that analysis, the lender can then decide whether to offer you a loan and if so, at what rate of interest. The lender can also grade applications and offer its lowest interest rates to its best applicants and vice versa.
Each lender has its own lending policy and just because you do not meet one lender's criteria, it does not mean that you will also fail another's. Consequently, it is useful to have a detailed understanding of what each lender will accept - but the problem is that there are literally hundreds of potential lenders in the UK, and it's a full time job keeping track of them all. That's why, unless you have a perfect credit history, it is advisable to make your application via a loan broker who has all this background information.
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