How to Clear Bad Credit Scores in Australia

There are several things to consider when you are considering clearing bad credit scores in Australia. Your credit scores tell many things about you as a consumer and your financial situation in general. There are many tips for clearing bad credit scores in Australia that can be used to fix your score. This article will give you an overview of what to look for when clearing bad credit scores in Australia.

 

Your credit report is going to contain information about every single transaction that you have made involving credit. This includes your credit card and loan information, where you live, how much money you make and any other relevant information. Every time you apply for credit or ask for financing, your score will be affected.

 

Order a copy of your credit report

 

The first thing that you can do is order a copy of your report from each of the three major credit bureaus. You should receive a report within sixty days. Make sure that you read and understand everything on it before you file for any kind of action. This way if there is inaccurate information, you can contact the company that issued the report and have them correct it. It is also a good idea to contact the Federal Privacy Commissioner to raise concerns about the accuracy of your report.

 

Pay down any outstanding debt

 

The next tip to help you with your credit score is to pay down any outstanding debt that you currently have. The closer that any outstanding debt is to your credit limit, the worse it will affect your score. It will even have a negative impact on your report if you have too many credit cards or loans. The only way to see if you have too many accounts is to request your report and check the numbers.

 

Close all of your accounts except one

 

If you can, close all of your accounts except one. You should then take the time to analyse those accounts to determine what you need to change so that they will not negatively affect your credit rating. If you have too many accounts open, then this process will take longer. You will also have to consider the amount of debt that you owe to each of your creditors. If this is more than two or three times the current loan balance, then you should consider closing them and getting a fresh loan.

 

Make sure that all of your debt is paid on time

 

A third step to help improve your credit scores is to make sure that all of your debt is paid on time. Part of the credit score formula takes into account how long it takes you to pay off a debt. For most lenders, this amount is only five per cent. As a result, paying your accounts on time will save you hundreds of dollars each year.

 

Add your credit cards back into your debt-free life

 

The fourth step to take is to add your credit cards back into your debt-free life. If you cancel your accounts, they will still show up on your credit history report. This is going to hurt your credit scores, even if you don’t cancel them. If you are close to maxing out your credit limits on your credit cards, then consider reducing the limits you have or paying off the card with the lowest balance first.

 

Request a copy of your credit report from each of your creditors

 

A final step in how to clear bad credit scores in Australia is to request a copy of your credit report from each of your creditors. Each of these reports has its own records. If you have unblemished credit, then they will likely give you a report without any problems. If you have judgments or other blemishes on your reports, you will have to contact each of these companies separately and try to work out a payment plan that will keep your accounts up to date. Clearing your credit report is one of the best things you can do for your credit scores. For more information, you may visit Credit Mend Australia.