IN tough economic times, access to easily available credit can be very useful. Being refused credit can be both embarrassing and problematic.

If you need access to credit now or in the future, take some time to clean up your credit file.

Banks and lenders use credit reference agencies (CRAs) to check your credit history before agreeing to give you credit.

There is a huge amount of information – good and bad – held on file about each one of us. You need to present this information in the best possible light.

The first step is to obtain your credit file from the CRA. The main agencies are Experian, Call Credit and Equifax.

You are entitled to a copy of your credit file by making a simple request in writing and paying the fee of only £2.

Once you have your credit file, check it carefully. Is it accurate and up to date?

You may have forgotten about a county court judgment you paid ten years ago, but it will still be on record.

You need to obtain a certificate of satisfaction from the court, and have the judgment recorded as satisfied on the register at trustonline.org.uk As far as possible, clean up your file and get rid of any nasty entries. If the records show that you owe an outstanding debt that you have in fact paid, then contact the lender.

Obtain written confirmation from them that payment has indeed been made. If any debt is still outstanding, make arrangements to pay it, by instalments if necessary.

Once you have checked your file and dealt with any damaging entries, you need to contact the CRAs and insist that your credit file is corrected.

You have a statutory right to insist that the CRA removes or corrects any inaccurate information. Simply give written notice to the CRA requiring them to correct any inaccuracies.

You can insist that a notice of correction in your own words is added to your credit file.

A failure by the credit reference agency to comply without good reason is a criminal offence.

This may sound like a lot of paperwork, but it is well worth it. A little time and effort spent in cleaning up your credit file now may well save you a lot of time, trouble and cash in the future.

■ Tom Lisgo is a partner at BHP Law.

For more information, contact him on 0191-221-0898