Five years ago, the only way to get an insider’s view on your credit report would have been by paying a website to find out your history for you. This used to cost anywhere between $50 and $200, depending on the provider and the extensive nature of the search – but these days, this type of service can be enjoyed completely free of charge.
There are dozens of websites out there that take the same stance on things as we do right here at The Mortgage Calculator; and that’s to provide free, helpful information for those in need.
With that in mind, we have one particular thing that plenty of people struggle with on a daily basis, but with no clear and concise guidance on how best to rectify the situation – we’ve decided to make a few suggestions. If you’re facing a low credit score, then take a look at these tips to help you to improve your report in as little as six months!
Consider taking out a short term loan
Now we know what you’re thinking… if you have a bad score, how on earth could you expect to borrow more money? Thankfully, there are plenty of lenders in Australia that offer services to those that can’t get credit anywhere else. If you take out a very small loan right now, say just $500 and then make sure that you pay it back on time, every single repayment that meets its deadline will add a little boost to your score. This can be a great way to prepare yourself for a mortgage application.
Pay off your existing debts
Debts are debts and they will follow you around for years if you aren’t careful. But as with all debts – once they are paid off, you will be in the clear! Your credit score might have taken a few hits as a result of late payments, but if there’s one thing that all lending agencies will appreciate, it’s the ability to get their money back. If you’ve missed your payments so far, then instead of leaving your debt to pass unpaid, why not invest a little cash to demonstrate that you’re keen to pay off what you owe? Once it’s done, your credit score will reflect this.
Consider your options
If you really are stuck in the mud where your credit history is concerned, then you might be feeling like you have nowhere to turn when applying for your mortgage. Don’t fret – there are still options out there. You could apply through a third party, or in simple terms have a loved one apply for a loan on your behalf. You could also ask a guarantor to secure your mortgage for you. You could even hire a mortgage broker to see if they’ll be able to negotiate fairer terms with a bank.