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Best Ways to Improve a Bad Credit Report

Whether we realise it or not, our credit report has a meaningful impact on our lives. It’s sort of like our health; we don’t treasure good health until we lose it. Most individuals 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 shock to some, given that even one overlooked payment that is documented by your creditor can stay on your credit report for a maximum of seven years.

So, what is a credit report? A credit report is a record that points out details about your financial history with creditors. In recent times, credit reports have been redesigned to place greater focus on constructive history like paying your bills on time, but overwhelmingly, credit reports are used by creditors to examine your ability 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 regardless of its severity can have a long-lasting influence on your financial opportunities for years to follow. Even though finding solutions to enhance a bad credit report can be challenging, there are various things you can do to enhance it. The good news is, we’ve gathered a list of suggestions that you can try to enhance 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 learn exactly what it contains. You can do this by paying a small fee to a business like ‘Check My Credit File’ (https://www.mycreditfile.com.au). It’s not unusual for oversights to be made on credit reports which can have a damaging impact on your financial capabilities. Read your credit report carefully and dispute any errors that you find to ensure your credit report accurately reflects your financial history. Some general mistakes that can occur are:

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

If you unmask any mistakes, alert the credit reporting agency in writing so these listings can be altered or removed to mirror your true credit history.

Pay your bills on time

People underestimate how important it is to pay your bills on time. Sometimes, individuals can be forgetful simply because they have too many bills to pay, so it’s an intelligent idea to get in touch with all your creditors and ask them to automatically debit your bank account each month. Typically, 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 sure that they’ll be paid on time and in full, which will have a positive effect on your credit report

Add extra information to your credit report

There are particular details within your credit report which creditors will view positively. As an example, if you are married, have been working with the same company for more than two years, or you are a property owner, then this information will improve your credit report. Creditors normally view this information in a positive light and it can assist in future credit applications. If you find that this sort of information is missing from your credit report, notify the credit reporting agency and request that it be included.

Steer clear of excessive credit applications

Every time you request a line of credit, it is mentioned on your credit report. Clearly, too many applications for credit will have a harmful effect on your credit report and the way in which creditors view your financial behaviours. It is very important that you are prudent and selective when applying for credit and only apply when you are confident it will be accepted. Also, if you recently had a credit application turned down, wait a decent amount of time before applying again.

Consider a debt consolidation loan

Naturally, 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 at least 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 fairly 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 Gladstone on 1300 795 575, or alternatively visit our website for further information: www.bankruptcyexpertsgladstone.com.au

 

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