- Posted by jaryd 12 Sep
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Check Your Large Personal Loan Credit History
Your credit history is important in helping a credit provider decide whether to lend you money. It tells them what your financial habits are like, and whether you’ve failed to meet your financial obligations in the past. You can request a copy from websites like www.mycreditfile.com.au – in some instances, it may be free. Check it carefully for errors, and be sure to investigate anything that looks incorrect. If your file highlights any valid issues in your credit history, contact the providers involved and find out how you can rectify them. Remember, a bad credit history could result in lenders declining future applications, or applying larger interest rates to the amount you borrow from them.
Always pay your bills on time
Having a mobile phone plan, a small credit card, or a Foxtel account is a great way to establish a credit history, but if you fail to make payments, it could result in a default being registered against you. Any payments that are overdue longer than 60 days will appear on your credit report for the next five years. If you are struggling to make a payment for anything, contact the provider immediately to see if you can work out a repayment arrangement that will prevent them from registering a default. There are some awesome apps out there help you budget accordingly
Try to stay put
A string of rapidly-changing addresses or places of employment acts as a red flag on your credit history. Lenders look for stability in both, so if possible, try to minimise the number of times you move around. If you do move house, don’t forget to let all your providers know where you’ve gone. If they can’t contact you after a default, it can be registered as a ‘clear out’ which is viewed very seriously, as it could be a sign of deliberate debt evasion.
Avoid making too many credit applications
Every time you apply for credit, the lender in question will check your credit history. This counts as a “hard enquiry” and deducts a few points from your credit score. Lots of hard enquiries in a short space of time will suggest to a prospective lender that you’re in financial difficulty and lessen the likelihood of them approving your loan. Therefore, try only to apply for credit when you really need it.
Protect yourself from identity theft
If someone steals your identity, it’s likely they will incur a bad credit history under your name. To make sure this doesn’t happen, take a few precautions to keep your identity secure. Make sure you clear your mail promptly and destroy any unwanted financial documents securely. Always cover the pin pad when using ATMs and EFTPOS terminals. Make sure your online activity is secure, and that any purchases are properly encrypted (look for the little padlock or the “https” code in the website address).
By keeping your credit history healthy, you’ll greatly improve your chances of successfully applying for a large personal loan.