Whether we realise it or not, our credit report has a considerable influence on our lives. It’s kind of like our health; we don’t cherish good health until we lose it. Many individuals don’t even learn that they have a poor credit report until they apply for a personal line of credit and it’s disapproved. It can come as quite a shock to some, since even one overlooked payment that is reported by your financial institution can remain on your credit report for a maximum of seven years.
So, what is a credit report? A credit report is a report that points out information about your financial history with creditors. Recently, credit reports have been remodelled to place greater focus on constructive history such as paying your bills on time, but overwhelmingly, credit reports are used by financial institutions to evaluate your capability to repay debts by assessing your past behaviour.
When financial institutions review your credit report, you normally either get a pass or fail so any default irrespective of its severity can have a long-lasting effect on your financial possibilities for years to follow. Whilst finding solutions to strengthen a poor credit report can be tricky, there are certain things you can do to strengthen it. The good news is, we’ve compiled a list of suggestions that you can try to boost your credit report and your overall financial health.
Review your credit report for any oversights
The first step is to inspect your credit report to discover exactly what it consists of. You can do this by paying a modest fee to a company like ‘Check My Credit File’ (https://www.mycreditfile.com.au). It’s not rare for errors to be made on credit reports which can have an undesirable influence on your financial abilities. Read your credit report extensively and dispute any oversights that you discover to make sure your credit report appropriately mirrors your financial history. Some typical errors that can occur are:
- Errors in personal information
- Wrongful defaults and judgements
- Old defaults and judgements
- Incorrect information regarding your credit history
If you unmask any mistakes, inform the credit reporting agency in writing so these listings can be amended or removed to mirror your true credit history.
Pay your bills on time
A lot of people underestimate how valuable it is to pay your bills on time. Sometimes, people can be forgetful simply because they have too many bills to pay, so it’s a clever idea to get in touch with all your creditors and ask them to automatically debit your bank account every month. Ordinarily, your lenders would be more than happy to do this as delivering paper invoices is time-consuming and costly. By putting all your bills on autopilot, you can be certain that they’ll be paid in full and on time, which will have a positive impact on your credit report
Add additional information to your credit report
There are particular details throughout your credit report which creditors will view positively. For instance, if you are married, have been working with the same employer for over two years, or you are a property owner, then this information will enhance your credit report. Lenders typically view this information in a positive light and it can help you in future credit applications. If you discover that this sort of information is missing from your credit report, inform the credit reporting agency and request that it be provided.
Keep away from excessive credit applications
Every time you request a line of credit, it is documented on your credit report. Naturally, excessive applications for credit will have a negative impact on your credit report and the way in which lenders view your financial behaviours. It is essential that you are reasonable and selective when applying for credit and only apply when you are optimistic it will be accepted. In addition, if you recently had a credit application turned down, wait a decent amount of time before applying again.
Contemplate a debt consolidation loan
Of course, it can be very tricky to oversee your debts when then you have lots of them. Forgetting just one debt repayment can turn into a default, which will remain on your credit report for a minimum of five years. Take into consideration a single debt consolidation loan which will accumulate all your debts into one, single, monthly repayment. Usually, interest rates on debt consolidation loans are quite low, and you’ll eliminate any further defaults which will have a positive effect on your credit report. If you’re interested in a debt consolidation loan, get in contact with our friendly team at Bankruptcy Experts Dandenong on 1300 795 575, or alternatively visit our website for further information: www.bankruptcyexpertsdandenong.com.au