Credit file, nowadays, plays a big role in granting loans to borrowers. A lot of loan companies use people’s credit files as a basis in approving or denying their credit applications. A standard credit file contains information about a person’s identification, credit accounts, credit inquiries, and public records and collections. However, recently, a change in credit report format was introduced; causing some misconceptions as to what really can be placed on the credit file. For instance, warnings pertaining to billing overdue fee are now noticeably indicated above the payment due box stating that overdue payments may incur a $15 late.
Minimizing the risk of late payment fees is made easy with these simple ways:
- Put up a regular direct deposit from your accounts. You can pay your dues in the convenience of your own home by just registering your account and paying your bills online. However, not all banks offer this kind of service.
- Make use of your phone to remind you days before your due dates.
- Download your bank’s mobile app and pay your bills through it.
The Office of the Australian Information Commissioner also mandates that a credit report must not include information about whether or not a person has missed paying his gas, electricity, and water bills. A person’s performance in paying his public transport or toll road bills, telecommunication contracts, and other credited goods and services should also be excluded.
A credit file shows a person’s financial history but not all firms are authorized to issue this kind of report. Only banks and loan companies with an Australian Credit License are allowed to issue a credit report, where a person’s possible capacity to pay for services and fees is indicated. And also, this does not guarantee that these authorized firms are going to provide error free reports. Mistakes can still happen thus a check over is necessary. Should a correction be made, there are loan firms that offer credit repair services for a fee. These firms can even make one’s report look rather impressive but of course, a larger fee comes with it.
According to VEDA, the largest credit reference agency in Australia which provides credit reporting, scoring, and marketing analytics services, 80 % of consumers are not aware of credit report’s existence and that they have one.
However important a credit file may seem, a person’s chance for credit is not always based on it. An application can also be denied because of the applicant’s inability to afford the term payments; something that can be grounded through savings history and regular income.