Best Ways to Repair a Bad Credit Report

Whether we realise it or not, our credit report has a considerable impact on our lives. It’s sort of like our health; we don’t treasure good health until we lose it. Lots of people don’t even know they have a poor credit report until they make an application for a line of credit and it’s rejected. It can come as quite a surprise to some, given that even one missed payment that is disclosed by your creditor 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 specifies information about your financial history with creditors. Recently, credit reports have been remodelled to place greater emphasis on favourable history such as paying your bills on time, but overwhelmingly, credit reports are used by lenders to evaluate your ability to repay debts by assessing your past behaviour.

 

When lenders check your credit report, you normally either get a pass or fail so any default irrespective of its severity can have a long-lasting impact on your financial possibilities for years to come. Even though finding solutions to enhance a poor credit report can be tough, there are specific things you can do to enhance it. Luckily, we’ve gathered a list of suggestions that you can try to boost your credit report and your general financial health.

 

Review your credit report for any oversights

The first step is to examine your credit report to learn exactly what it contains. 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 errors to be made on credit reports which can have an adverse impact on your financial abilities. Read your credit report extensively and challenge any mistakes that you discover to ensure your credit report accurately emulates your financial history. Some typical oversights that can occur are:

 

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

 

If you discover any errors, alert 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 significant it is to pay your bills on time. Occasionally, individuals can be forgetful considering that they have too many bills to pay, so it’s a wise idea to talk to all your lenders and ask them to automatically debit your bank account each month. Normally, your lenders would be more than happy to do this as delivering paper statements is time-consuming and costly. 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 extra information to your credit report

There are a number of details within your credit report which creditors will view favourably. For instance, if you are married, have been working with the same employer for more than two years, or you are a homeowner, then this information will strengthen your credit report. Lenders 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, advise the credit reporting agency and request that it be added.

 

Steer clear of excessive credit applications

Each time you make an application for a line of credit, it is documented on your credit report. Evidently, too many applications for credit will have a harmful effect on your credit report and the way in which lenders view your financial behaviours. It is imperative 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 denied, wait a decent amount of time before applying again.

 

Contemplate a debt consolidation loan

Generally, it can be very challenging to control your debts when then you have lots of them. Overlooking just one debt repayment can turn into a default, which will stay on your credit report for a minimum of five years. Think about a single debt consolidation loan which will accumulate all your debts into one, single, monthly repayment. Generally, 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, contact our friendly team at Bankruptcy Australia on 1300 795 575, or alternatively visit our website for further information: www.bankruptcy-australia.net.au