Credit Checks & Continuous Monitoring
Before appointing a builder for a project, it’s essential to verify their financial stability and track record—much like a bank would when considering your credit card application. Think about it: for a credit card, which is often for a much smaller amount than a building project, the lender will want to know all about your financial history. It’s only fair that you apply the same diligence before allowing someone into your home and entrusting them with your project. By checking their bank account details – be sure the account is owned by the same company, VAT number – if they are charging Vat make sure they are registered, credit history – make sure they dont have a history of defaults, County Court Judgments or a Bankruptcy you protect yourself from unreliable contractors, Constant monitoring throughout the project.
Bank Account Verification
A Bank Account Verification Check is an important step in preventing fraud by confirming that a builder/contractor owns their bank account and has a legitimate transaction history. This verification helps identify any suspicious activity, protecting both businesses and individuals from financial scams. By ensuring that invoice payments are directed to legitimate business accounts rather than personal accounts, it significantly reduces the risk of fraud. Overall, this check enhances the security and trustworthiness of financial transactions, making it a vital practice for maintaining financial integrity.
VAT Number Verification
A Vat number check is essential for ensuring that a VAT number is valid, especially when working with a new builder/contractor if they are charging Vat (an additional 20%). This check serves two main purposes. Conducting this check is a crucial part of due diligence that safeguards your finances and home.
1st It protects you against fraud. Scammers often create fake companies and use false VAT numbers to appear legitimate. Verifying the VAT number ensures it’s real and matches the company you’re dealing with, helping you avoid potential financial loss.
2nd It helps catch any errors in recording VAT numbers, which can prevent issues when claiming back VAT from HMRC. If you submit an invalid number, your claim could be rejected.
What’s the Difference Between a Hard and Soft Credit Check?
Soft Credit Check
A Soft Credit Check, on the other hand, does not affect your credit score. It’s typically done when you check your own credit score or when a company checks your credit to verify your identity or assess your creditworthiness. Soft searches are private and cannot be seen by other lenders.
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Hard Credit Check
A Hard Credit Check occurs when a lender reviews your credit report to decide whether to lend to you. This search leaves a mark, or “footprint,” on your credit history, visible to other lenders. Multiple hard checks in a short period can lower your credit score and make you appear as a higher risk to future lenders.
Why We Use Soft Searches We only conduct Soft Searches to look at someone’s credit information without leaving any impact on their credit score. A Hard Search can leave a mark, potentially lowering their score or making them appear riskier to future lenders. Soft searches let us access all the key details we need without affecting their ability to get credit in the future
Key Information from a Soft Search
• Credit Overview
• Payment History
• Public Records
This information is enough to assess creditworthiness without leaving a trace or impacting future credit applications.