Wednesday, 27 December 2017

New Year’s resolution: repair credit score

Black marks against your credit history can have a bigger impact on your life than you may realise. The negative effects can range from more minor inconveniences, such as difficulty getting a mobile phone contract, to major setbacks such as being rejected for a home loan.

Fortunately, there are steps you can take today to repair your credit score. Set a new year’s resolution to do this before the year is out, so you can start 2018 with a clean slate and financial peace of mind.

First, get a free copy of your credit report

The first step is knowing what’s on your credit report and if there are any issues. We can provide you with a free copy of your credit report. This will include your current credit score and a detailed explanation of the information on your report. If there is a problem, then we’ll develop a plan to help remove black marks and restore your credit rating.

Challenge anything that’s not right

While a credit default listing remains on your report for five years, you may not have to wait that long for it to be removed if you can prove that the information is wrong. You have a legal right to contest any information on your report that you think is incorrect or unfair. You can either do this yourself or hire an expert to do it for you.

Consolidate your debts

If you do have defaults and payments outstanding, it’s time to take charge of your debt. While you can’t do anything about past bad debts, you can put a halt to ongoing damage. Consider consolidating your debt into one single, manageable loan. These tend to have reasonable interest rates and having one monthly fee will make repayment easier to manage.

Add positive information

Just as negative listings damage your credit score so positive information can help. These include things such as ongoing employment (two years or more is good), stable residential addresses, being approved for different types of finance (e.g. home loan, car loan, credit cards) and meeting your repayments commitments. If any of these aren’t up to scratch then make a plan to get on top of them.

Set your bills to autopay

Paying your bills on time will help improve your credit score over time. So, set up direct debits or automatic credit card payments for all of your regular bills. If you truly can’t pay a bill on time, proactively speak to your creditor before it’s due as they may be able to push back the due date on one off occasions. The most important thing is to ensure it’s paid before f60 days so that it doesn’t end up as a default on your credit report.

If you do find you have a problem with your credit report contact us to find out how we could help you repair it.