Lenders use credit reports to assess whether potential borrowers are reliable, stable and do not already owe more than they can comfortably repay. To calculate the chances that you'll make your repayments, they take the information in your application form and credit report and allocate each item a value. They then use a unique formula to calculate a credit score. Generally, the higher your score, the easier you'll find it to borrow.
Your credit score also changes over time as your circumstances change. For example, paying off a loan could improve your score, while missing a couple of repayments could cause it to fall.