With doubt, it pays to keep an eye on your payment habits. Before applying for loan or credit card, it is always a good idea to find out your credit score first. Your credit score and credit history play a big role in determining whether or not your finance is approved or not. Your lender may employ different methodology from some credit score websites. However, these websites will give you important ideas of whether it’s possible for you to obtain finance.
You can get your credit score for free from two websites, and that’s getcreditscore.com.au and creditsavvy.com.au. Peer-to-peer lender SocietyOne backs Getcreditscore.com.au, and it uses Veda data. Creditsavvy.com.au uses information from Experian. Although the sites use different data, you can get your credit score from both of them.
The good thing about these websites is that you don’t have to worry about your credit score because they don’t affect your credit file. Requirements for getting your score include, your full name, date of birth, email, driver’s license number and current address. After filling these details on either of these websites, your score will appear on the screen, but the two websites have different scoring ranges.
For instance, on GetCreditScore, the scores ranges from 0-1200 while CreditSavvy ranges from 0-1000. The higher your score are on both websites, the better. Ratings are subject to change over time. More so, if your score results aren’t great, you don’t have to worry because there are things that you can do to improve the score. You can start by paying down your credit card balance. Remember that carrying a high percentage of debt in relation to available credit pull down your credit rating, that’s why it’s important to focus on paying down these balances.
Secondly, you can concentrate on improving your payment habits. Try to keep your payment history positive because it accounts for 35% of your credit rating. It’s considered right to close all accounts that you no longer use. A percentage of your score is dependent on the length of your credit history. Typically, a long credit is considered beneficial; you may, therefore, want to keep your old accounts open to make your overall credit history as lengthy as possible.
Above all, it is also important to maintain a good mix of credit because lenders want to see a mix of credit types as a guarantee that you can easily handle different types of credit such as mortgages, car loans, credit cards and personal loans. To wrap up, when you want to apply for credit, do it when it is necessary. Keep in mind that, application for a credit card or loan is an activity that is reflected in your credit report. Therefore, too many applications in a short period of time can significantly affect your credit history.