26 Jul Credit rating – should I care
Credit rating – should I care ?
Credit rating is a strange beast, it’s hidden from most of us but can affect any accounts or services you may apply for.
What is a credit rating?
A credit rating is your history (up to 7 years) of your financial commitments. It records things such as loans, history of enquiries, overdue bills, late payments, defaults and even bankruptcy. Businesses use a credit rating so they can decide if they are likely to get paid by providing you a service.
Having a bad credit history can impact things like applying for a mortgage, store credit, utilities and even phone plans. Luckily most items on your credit history will be removed after 5 years.
Veda is the company that manages your credit rating and it is possible to get a free copy every 12 months or if you have been declined credit. This gives you the ability to review the information make sure it’s correct and see what may be negatively impacting your score such as outstanding debts. Its important to check as sometimes it can be incorrect.
What impacts your credit rating?
• Overdue debts
• The number of credit enquiries in the last five years
• Loan accounts and amounts
• Credit information such as accounts , open and close dates and credit limits
• Repayment history
How to improve your score?
While there is no magic bullet to improve there are some things you can do to get started. Talk with any outstanding bill/loan providers that are impacting your rating, you may be able to enter a payment plan to get the debt removed/cleared from your score. Ensure that any debts you pay off get updated to reflect this. The easiest way is to stay in contact with providers to ensure it doesn’t end up on your file to begin with.
In short YES you should care.
If you’re not sure where to start contact BudgetNet today on 1300 402 568 and get back on track.