Efficient Credit Reporting System to Boost Your Credit Scores

If you are going to buy a new car or a new home, you need loans to own them. To facilitate the lending and making the credit accessible to the individuals, there is an effective credit reporting system. Since a very long time, Australia had displayed a very negative credit report system. It has generally included negative information about your credit history but it had never shown something when you have managed your credit well on time. This then triggers the introduction of comprehensive credit reporting. It offers you a very effective system that allows the credit providers to have access to more comprehensive information to make the better decision about whether to give the loan or not. 

Information included within the credit reporting system 

• Your basic information including your name, date of birth, gender, current or previous address and driver’s license number.
  
• Information that you have applied for the credit and it will also show the amount and type of credit you have applied for.
  
• The date on which you have opened your credit account and the date on which it was closed.
  
• Type of credit accounts that you have opened
  
• Amount of credit available under each credit account
  
• Terms and conditions related to credit repayment
  
• Names of the credit providers and information that whether they hold the credit license or not
  
• Information that will show that you have paid the full amount for the default
  
• If you have made the monthly repayments on time over the past two years, this information will also be displayed
  
• Information regarding the credit history in Australia and activities

Even if you have applied for any commercial credit, it will also show the information regarding it and the amount and type of credit you have applied.

Unbelievably, these additions to the credit reporting system will definitely increase the credit scores of millions of people. It has dropped much negative information from the credit reports that include civil judgments and tax liens. These were often attached to the customers, thus hampering their ability to get credit for a car or home.

Simultaneously, the lenders will have to face some difficulty in making a balance between the customer needs for credit and the needs of the bank to accurately access that who is going to pay the loan on time. Thus, it is undoubtedly a progressive step towards boosting the credit score.

What Credit Score Is Needed To Buy A House?

For most of us, purchasing a house is a major financial situation that calls for borrowing money. For this, a loan is needed and as we know, all banks and lenders rely on credit score for approval of loans. Yes, those three tiny digits can mean the difference between the yes and no; in other words, can decide whether you are moving to your dream home or not.

Now there will be many questions striking your mind, such as:

• Do I have a good credit score?
• What is the credit score needed to buy a home?
• What is minimum credit score to buy a house?
• Is there any direct relation between credit score & interest rate?

If these and more such questions are coming in your mind then this blog will provide answer to all your queries.

The Basics of Credit Score

You credit card is not only needed for getting a mortgage rather it clearly states your financial picture. The credit number signifies the creditworthiness of a person, higher the score, higher is credit worthiness. Therefore, in simple words, a person with a higher score is almost guaranteed to pay his/her debts whereas a person with low score is more likely to miss payments.

Payment History, Amounts Owed, Length of credit history, New Credit, Types of credit used, all these factors play a major role in calculating the score of your credit card.

Now, the next important question is what credit score is needed to buy a house

There is no hard & fast rule for this. However, a credit score of 600 or above in Australia is considered good. So, if your credit score is 600 or above then there are positive chances of loan approval. If your credit score is lower than there are less chances of qualifying the loan but in this case lenders consider other criteria such as solid assets if any, source of income that makes up for the low credit score. So, before applying for your home loan get a credit check Australia for your score.

For anything you need pertaining to loans in Australia, the finance brokers at Loans Direct can assist you in finding the best option.

How does Lost or Stolen Credit Cards Hurt Your Credit Score?

How the times have changed to where it's not about who wears the pants in the family and instead about who carries the credit cards! Some husbands, however, feel very relieved on the thought of their lost or stolen credit card, since, of course, a stolen or lost credit card will mean much lesser expense than the expenses their wife does! The thing that actually bothers many of us is that how a lost credit card would hurt our credit score.

How do we handle a situation of lost or stolen credit card? 
Let's suppose that you've reissued your credit card. Beyond any doubt, the new credit card will have a different number. The old card will be cancelled. Will the credit score also vanish along?

First things first, when you lose a credit card, or unfortunately get it hacked, you must flag the transactions as fraud. You get your account credited back in a couple of days. When the thief tends to use your credit card again, even the credit card company cancels the transaction and the credit card can no more be used fraudulently in future.

Further, you basically have two options. Remember that each card company may handle the replacement of credit cards differently.

• You can change your account to a new number.
  This way the original trade-line remains in your credit report. Your account's open date will be preserved and the payment history will remain under one account.


• You can also cancel the current account and open a new account.
  Let your original account show 'lost and stolen' with zero balance and still retain all your payment history. The entirely new account will use the same open date with an outstanding balance as your original one. This will lead you to two credit cards – one closed and another opened. So, you'll have one trade-line closed and the other is opened.

Do not worry. This eventually leads us to the good news - as long as you preserve your original account's open date as well as the credit limit, the replacement of the account shall only be a piece of cake. This will not hurt your credit score and you can easily have a credit check Australia after that.