What do lenders actually check when you apply for credit?

Three broadly separate things, and people tend to focus on only the first.

Your credit file. A record held by credit reference agencies covering accounts you hold, payment history, defaults, county court judgments, bankruptcies, and how much of your available credit you are using. This produces the score you can look up — though the score itself is not what lenders see. Each agency calculates its own, each lender applies its own model to the underlying data, and the consumer-facing number is an indication rather than the thing being assessed.

Affordability. Increasingly the decisive factor. Lenders must establish that you can afford repayments sustainably, so they look at income, existing commitments, dependants and essential outgoings, often against expenditure benchmarks. This is why someone with an excellent credit history can still be declined: the file says you repay reliably, the affordability assessment says the new payment does not fit.

Their own policy and existing relationship. Lenders set internal rules — minimum income, maximum exposure per customer, appetite for particular customer segments — that vary between institutions and change with economic conditions. This is why a decline from one lender says little about another.

Two things that surprise people:

Thin files are a problem. Never having borrowed is not read as a positive; it is read as unknown. Having no history can be harder than having a modest one.

Multiple applications in a short period hurt. Each leaves a hard search visible to others, and a cluster reads as distress. Use eligibility checkers, which perform soft searches that only you can see.

Credit utilisation, payment history and the age of accounts generally carry the most weight within the file itself.