Whether we understand it or not, our credit report has a significant effect on our lives. It’s sort of like our health; we don’t treasure good health until we lose it. Most people don’t even know they have a bad credit report until they make an application for a personal line of credit and it’s rejected. It can come as quite a bombshell to some, given that even one missed payment that is documented by your lender can remain on your credit report for a maximum of seven years.

So, what is a credit report? A credit report is a document that stipulates information about your financial history with financial institutions. In recent times, credit reports have been remodelled to place greater focus on favourable history like paying your bills on time, but overwhelmingly, credit reports are used by financial institutions to gauge your capability to repay debts by assessing your past behaviour.

When financial institutions inspect your credit report, you usually either get a pass or fail so any default regardless of its severity can have a long-lasting effect on your financial prospects for years to follow. While finding solutions to repair a poor credit report can be tricky, there are certain things you can do to enhance it. The good news is, we’ve compiled a list of ideas that you can try to boost your credit report and your general financial health.

Check your credit report for any errors

The first step is to check your credit report to discover exactly what it features. You can do this by paying a small fee to a company like ‘Check My Credit File’ (https://www.mycreditfile.com.au). It’s not uncommon for mistakes to be made on credit reports which can have an unfavourable influence on your financial abilities. Read your credit report meticulously and challenge any errors that you find to ensure your credit report appropriately reflects your financial history. Some common mistakes that can occur are:

  •  Errors in personal information
  •  Wrongful defaults and judgements
  •  Old defaults and judgements
  •  Incorrect information concerning your credit history

If you unmask any oversights, 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

Individuals underestimate how important it is to pay your bills on time. Occasionally, individuals can be forgetful simply because they have too many bills to pay, so it’s a wise idea to contact all your creditors and ask them to automatically debit your bank account every month. Typically, your creditors would be more than happy to do this as posting paper invoices is time-consuming and costly. By placing all your bills on autopilot, you can be certain that they’ll be paid on time and in full, which will have a positive impact on your credit report

Add extra information to your credit report

There are particular details within your credit report which lenders will view positively. As an example, if you are married, have been employed by the same company for more than two years, or you are a property owner, then this information will strengthen your credit report. Creditors generally view this information in a positive light and it can assist in future credit applications. If you see that this type of information is missing from your credit report, notify the credit reporting agency and ask that it be provided.

Avoid too many credit applications

Every time you request a line of credit, it is mentioned on your credit report. Evidently, excessive applications for credit will have an adverse impact on your credit report and the way in which lenders view your financial behaviours. It is paramount that you are shrewd and selective when requesting credit and only apply when you are optimistic it will be approved. Additionally, if you recently had a credit application turned down, wait a decent amount of time before applying again.

Look into a debt consolidation loan

Naturally, it can be very problematic to oversee your debts when then you have lots of them. Forgetting just one debt repayment can become a default, which will stay on your credit report for at least five years. Look at a single debt consolidation loan which will accumulate all your debts into one, single, monthly repayment. Normally, interest rates on debt consolidation loans are quite low, and you’ll eliminate any further defaults which will have a positive impact on your credit report. If you’re interested in a debt consolidation loan, get in contact with our friendly team at Bankruptcy Experts Port Stephens on 1300 795 575, or alternatively visit our website for more information: www.bankruptcyexpertsportstephens.com.au

 

Best Ways to Repair a Poor Credit Report