What's your credit rating?
And why is it important?
Upcoming legislative changes mean having a good credit rating and history will be more important than ever before for anyone looking to take on new debt – whether it’s a personal loan, home loan, or credit card.
If you don’t know what your credit rating is and you’re planning to apply for lending anytime soon, now is a good time to check your report and identify any possible issues so that you can work on resolving them so that you’ve got your best foot forward for your application.
What does a credit report tell you?
It covers your history of bill payments, use of credit, along with any defaults or court judgments.
It can also include your credit score which is a number between 0 and 1000 that estimates your ability to keep up with bills. Your credit score can be affected by how often you move house, how many inquiries you have as well as your history of payments.
Requesting your online credit report
There are three credit reporting bureaus that you can request a free copy of your credit report from:
Once you’ve received your credit report
It’s important to read through your report carefully to see if there are any errors that need to be fixed. If you see inquiries, accounts or defaults on your report that you don’t remember, you should question them to see if they are errors or possibly related to identity fraud.
If your credit report or credit score needs improving because of any legitimate missed payments or defaults, now is the time to put a plan in place to start increasing your positive credit history. Focus on keeping up to date with payments and consider any other changes you might want to make such as prioritising repaying any existing debt you have.
Why is having a good credit rating important?
The upcoming credit law changes mean your credit history will be assessed at a much more detailed level when applying for lending. Your credit report is also used by potential landlords and employers to decide if they should offer you a tenancy or job, so you’ll want to make sure it’s as good as possible.