If you have a credit card or a loan, or have even just applied for either, you have a credit history.
What you may not realise is that what is recorded on your credit history has changed as of 1st July 2018.
Previously, lenders only shared negative information such as defaults, bankruptcy, court judgments, along with listing applications for credit. There was no report stating if you paid your bills on time or late, only reports of more serious problems. Under the new system, credit providers will also have to share positive information, such as when you made all your repayments.
HOW DOES THIS AFFECT ME?
A history of making regular payments, repaying a loan early or closing unused accounts (such as excess credit cards) can now help you demonstrate your creditworthiness and increase your ability to obtain credit. Good money managers will now be given more recognition, and ultimately rewarded with better access to finance.
On the other hand if you are in the habit of paying bills one week past due date, this will in future impact your ability to obtain a loan.
WHAT TO DO?
Your repayment history now counts, paying bills on time is important! We recommend setting up direct debits where possible to avoid missing due dates.
Only apply for credit when you need it – do your research before any application, less enquiries are better for you (that is the value of a broker, who will do the research for you across multiple banks without multiple credit enquiries).
Monitor your credit file and credit score (it costs nothing) and keep an eye out for errors or fraudulent activity on your file.
If you have a history of paying all your bills on time, that is great! Keep up the good record, you will be rewarded for it.
If on the other hand you have been guilty of making late payments at times, this is your chance to take charge, and amend your habits before it is too late. This credit reporting is commencing now, and note data is held for 2 years on your file.
If you have individual questions to raise call our office, we are happy to assist where we can.
Integrity Finance Australia– Changing Lives
Daryl Borden, your Dingley Village Mortgage Broker, Ph. 03 9511 8883 ACL 392184