While it can seem that a poor or even bad credit score is the end of any financial hope of securing a home loan, the good news is your credit score can be improved. However, it will take time and effort on your part, and a strategic, well-thought out plan to rectify any problems.
In order to fix or improve your credit score you firstly need to know what you should be focusing your time and energy on. This means obtaining a copy of your credit report, checking its accuracy and developing ways for you to manage your money better. Let’s look at how you can get the credit score you crave.
Ways to Improve Your Credit Score
1. Obtain a copy of your credit report – Your credit report is a record of your financial history, which includes any credit applications, overdue payments and bankruptcies, as well as loan and credit repayments. This document gives you a rating based on how well you manage your money, which, in turn, gives a lender an indication of their level of risk.
To obtain a copy of your credit report contact www.mycreditfile.com.au. You can get a free copy of your credit report once every 12-months, or if you’ve applied for credit and it’s been declined, then you have 90-days from the date of your application to obtain a copy of your report.
2. Review your credit report – When your report arrives go through the document and make sure all entries are correct. If you find that there are debts listed which have been paid, then you need to contact the credit agency who sent you the report so that the errors can be changed.
3. Pay off debts – If you have any outstanding loans and debts, then start making regular payments on these. If you can, pay more than the minimum required payment. This will increase your credit score over time.
4. Reduce credit limits – If you have a credit card or cards then reduce the limits on these to the minimum level. Then pay off any outstanding balance. This will reduce the temptation to spend more than you can afford, and help you to get your finances under control.
5. Speak to creditors – If you’re having problems paying your bills, then contact the company you owe money to and make arrangements to pay back what you owe using a payment plan. This can help you to avoid incurring a bad payment record on your report, which will affect your credit score.
6. Seek professional advice – If you’re finding it difficult to manage your bills and to create a budget, then contact a budgeting assistance group. Financial advisers and other money management organisations can help you manage your money better and to devise a plan to get your finances under control.
Overall, be patient and persistent. You’ll develop a better credit score over time.
Do you need to improve your credit score? Then contact eChoice. we’ll help you to understand your credit report.