The first, and most important, thing you can do is to deal with your existing credit correctly, by paying bills in full and on time. This is the hardest medicine because it may require tough decisions, but it is the best way to steadily improve your rating.

Apply online to one of the three rating agencies (Equifax, Experian or Callcredit) for a copy of your statutory credit report (this costs just £2). If you find a mistake, even a minor one, make sure you ask the agency for it to be corrected. The smallest mistake can damage your rating.

Another easy step you can take is to register on the electoral roll at your current address. This is used by many companies to confirm your identity and without it you may find it harder to apply for credit or insurance. And make sure to avoid repeated applications as each failed application leaves a footprint.

Lenders like to see a stable “credit history”, so having too few or too many cards or loans can work against you. If you have dormant cards make sure you close them down as holding too many can have an adverse effect – lenders look at the total amount of credit available to you, regardless of whether you use it.

Or if you don’t use credit consider opening a credit card solely to establish a credit history – just make sure to pay it off every month. This will help you if you want to apply for a mortgage or personal loan in the future.

If you already have a credit card try to avoid owing more than 30 per cent of your credit limit. Likewise your credit score will suffer if you regularly reach the bottom of your agreed bank overdraft facility.

Remember it takes time to improve your credit rating and convince lenders that you can manage your finances and are a good candidate for credit.