Having bad credit is not unlike having a bad cold. It spreads very easily and you are never quite sure who you got it from and how many people can hear you sneezing and walk away!
The fact is that although we talk about credit history and a credit record there is no one place where that record can be found and no one clear formula used for calculating that record. Experts estimate that it takes about six months normal credit operations – receiving and paying bills – to establish a credit history but different banks, retailers, credit card companies have their own formulae – probably all fairly similar – by which they make the calculation.
In short, lenders want to know how much of a risk they are taking in lending you money.. To work that out they look at how many debts you have, what the totals are and your track record for repayment.