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Having an application for credit refused is never pleasant, especially if you don’t know why it's happened. Here's what to do - and how to give yourself some credit next time round.

• Understand how lenders work. They want to see that you can repay what you borrow comfortably and on time, so they look at your application form for evidence that you earn enough and check your credit history to see what you’ve already borrowed and how you’re coping. You should check it too, to be sure it’s up to date and accurately reflects your circumstances. It needn’t cost you a penny – it’s free to see your Experian credit report online when you take a trial of the credit monitoring service CreditExpert.

•Ask why you were turned down. You may be able to do something about it – or you may simply not fit the profile for that particular deal. For example, you might not earn enough.

• Build a credit history. If you don’t have a track record of repaying credit, lenders can’t guess how you’ll behave in future. You could start with a credit or store card, use it for everyday shopping and pay the bill in full each month. That way you won’t get into debt. Having an overdraft facility on your current account can also help build your credit history, as long as you don’t exceed your agreed limit.

• Register to vote at your current address – it will give your credit rating a boost. If you’re not on the electoral roll, or are down at another address, lenders may ask for proof of residence or even turn you down.

• Set your credit record straight. You can see your Experian credit report for free, so look for anything you think is wrong or out of date. Then contact the relevant lender and explain your side of the story – and be prepared to provide proof.

• If there’s a reason for past problems, you may be able to add an explanation to your credit report. For example, you might have missed a few repayments because of an accident. You can also use this process – known as adding a Notice of correction – to explain that you have a thin credit file because you simply haven’t borrowed much in the past. You could also offer to provide other proof that you’re a reliable and responsible person, such as bank or council tax statements.

• Don’t fire off random credit applications. When lenders search your credit report to assess your suitability, it leaves a record, known as a footprint. Too many of these can make other lenders think you’re desperate. Instead, research your options carefully and ask for a quotation search if a lender needs to look at your report before telling you the interest rate. Only apply when you’re sure you have the best deal. Checking your own credit report does not harm your creditworthiness.

• Don’t let an ex’s credit history drag you down. For example, lenders may search their credit report as well as yours if you share a joint account, such as a mortgage or card – and if they’re having money trouble, it could count against you. When you split up, make sure to separate your finances along with the CDs and saucepans.

• Protect your ID from criminals who impersonate their victims to borrow money and run up debts. Check your credit report regularly to spot suspicious applications, new accounts or high balances and stop the trouble before it can develop.

• Never skip repayments – it damages your credit rating. Instead, talk to your lenders. They may be able to reschedule your repayments or even give you a short payment holiday. Direct Debits can help make sure you don’t miss regular payments.

• Take control of your finances. Set a realistic budget, apply for benefits if you qualify - and keep an eye on your credit report with a free trial of CreditExpert, the online credit monitoring service. It lets you see your Experian credit report as often as you want.

• Don’t try to borrow your way out of trouble. Look very carefully at all of your options and seek advice if necessary.

• Don’t pay for advice – it’s free from organisations such as Citizens Advice, the Consumer Credit Counselling Service or National Debtline. Find their contact details online.