Best Ways to Improve a Poor Credit Report

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Best Ways to Improve a Poor Credit Report

Whether we acknowledge it or not, our credit report has a considerable effect on our lives. It’s kind of like our health; we don’t appreciate good health until we lose it. Lots of people don’t even learn that they have a bad credit report until they apply for a personal line of credit and it’s rejected. It can come as quite a surprise to some, since even one missed payment that is reported by your lender can remain on your credit report for up to seven years.

So, what is a credit report? A credit report is a document that specifies details about your financial history with financial institutions. In recent times, credit reports have been redesigned to place greater focus on constructive history such as paying your bills on time, but overwhelmingly, credit reports are used by financial institutions to calculate your ability to repay debts by assessing your past behaviour.

When lenders inspect your credit report, you generally 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. While finding solutions to boost a poor credit report can be complicated, there are certain things you can do to strengthen it. The good news is, we’ve compiled a list of recommendations that you can try to strengthen 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 uncover exactly what it contains. You can do this by paying a modest fee to an agency like ‘Check My Credit File’ (https://www.mycreditfile.com.au). It’s not rare for oversights to be made on credit reports which can have a negative impact on your financial abilities. Read your credit report carefully and challenge any errors that you discover to ensure your credit report appropriately reflects your financial history. Some general oversights that can occur are:

  •  Mistakes in personal details
  •  Wrongful defaults and judgements
  •  Old defaults and judgements
  •  Inaccurate information relating to your credit history

If you discover any errors, advise the credit reporting agency in writing so these listings can be adjusted or removed to reflect your true credit history.

Pay your bills on time

Individuals underestimate how vital it is to pay your bills on time. In some cases, people can be forgetful simply because they have too many bills to pay, so it’s a smart idea to get in touch with all your lenders and ask them to automatically debit your bank account every month. Often, your creditors would be more than happy to do this as delivering paper invoices is time-consuming and expensive. By placing all your bills on autopilot, you can be sure 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 favourably. For example, if you are married, have been employed by the same employer for over two years, or you are a homeowner, then this information will improve your credit report. Lenders normally view this information in a positive light and it can assist in future credit applications. If you uncover that this sort of information is missing from your credit report, alert the credit reporting agency and ask that it be added.

Keep away from excessive credit applications

Every time you make an application for a line of credit, it is documented on your credit report. Obviously, too many applications for credit will have an adverse impact on your credit report and the way in which lenders view your financial behaviours. It is imperative that you are sensible and selective when making an application for credit and only apply when you are optimistic it will be approved. Likewise, if you recently had a credit application denied, wait a decent amount of time before applying again.

Look into a debt consolidation loan

Certainly, it can be very tricky to control your debts when then you have lots of them. Overlooking 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. Typically, 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, talk to our friendly team at Bankruptcy Experts Hobart on 1300 795 575, or alternatively visit our website for further information: www.bankruptcyexpertshobart.com.au

 

By | 2018-07-16T03:06:48+00:00 June 20th, 2018|Bankrupt, blog|0 Comments

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