how do i know if i have bad credit
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How do i know if i have bad credit

How Do I Know if I Have Bad Credit? How to Deal With It

You have probably heard that having bad credit makes life more awkward. Yet, have you ever taken a moment to wonder whether you have a problem with your credit history?

Lots of people stop to wonder, “How do I know if I have bad credit?” Yet, a lot of them then do nothing about it. This is something that you might not think about again until it becomes a problem.

It is so easy to check your credit record that there is no reason to put it off any longer. If you have thought about it then now is the time to find out the answer.


Who Do You Check Bad Credit With?

There are three different credit reporting bodies in Australia. They are as listed below.

The easiest way to do this to get in touch with one of them through their website. There is no need to contact all three of them.

If you prefer to phone them then you will find each number listed on the respective site. You can also get online support or check out the FAQ on their sites if you need any help.

To order your credit report, you need to provide identification. This ensures that they only ever give out this sensitive information to the right people.

Registering and providing your ID should only take a matter of minutes. At this stage, you will now be able to see the basic information around your personal credit history.

After that, a comprehensive credit report will be sent out to you. This can take up to 10 working days to arrive.


Is a Credit History Check Free?

Each of the credit reporting bodies listed above have the obligation to provide you with information for free. They need to give you the report for free once every 12 months, if you ask for it.

You can also ask for a free copy if you are refused credit. Just remember that you need to do this within 90 days of being refused credit.

Another situation in which you can ask for a free report is when you have had any of the relevant personal information on it corrected.

Other than those cases, the agencies can charge a small fee when you ask for your credit report. The government guidelines on this make it clear that the charge “mustn’t be excessive”. In addition, frequent users can take out a subscription plan with the Equifax agency.


Understanding Your Credit Report

You don’t need to worry about whether this is going to be a long, complicated document. It is going to be easy enough to understand your credit score once you see it.

To help you out the agencies advise on their sites how to interpret their reports. Since they are all very similar, we will use the information from Experian as an example of what you will see.

  • The top of the report shows your personal information such as name, date of birth etc. You should check that all of this is correct. If it isn’t then you need to request that the errors are fixed.
  • You then see a score of between 0 and 1,000 (this number varies by agency). Any issues that have negatively impacted the score will be listed in red boxes below the score.
  • The next part shows details of open accounts you have that aren’t reported.
  • After this comes details of the applications for credit that you have made in the previous 5 years. What it doesn’t show is whether you were accepted or declined.
  • You will then see all of the payments you have made in the last 2 years to the credit providers that report to them. A green tick is a payment that was made on time. If it shows a number then this is the number of missed payments currently outstanding.
  • Next are the defaults on your history and whether they are now paid or settled.
  • The serious credit infringements section details any fraud, attempted fraud or attempts to avoid your credit obligations that have been reported.
  • Then there is a commercial credit history part that covers any business loans or cards you have used.
  • The part with public information explains the details that are publically available about you. This includes whether you have been made bankrupt and if any court actions against you have been successful.
  • There is also room for a personal statement from you. This is something you may choose to add if you want to clear up anything such as a problem with your identity being stolen. Credit providers who check your record can see this statement.
  • The final section shows who has accessed your credit record.


What Do You Do Next?

At this point, you may still be asking “How do I know if I have bad credit?” After all, the information you have seen so far might not be conclusive.

The number on the report is the best guide. With Equifax, this number runs from 0 to 1,200. They advise the following categories.

  • 0-509 is below average and probably includes some sort of adverse credit history. Traditional credit providers won’t be keen to give you a loan.
  • 510-621 is average. This sort of score is seen as indicating that you could suffer an adverse credit event in the next year.
  • 622-725 is good.
  • 726-832 is very good.
  • 833 and above is excellent. You are in the top 20% and shouldn’t have too many problems in getting hold of credit when needed.


What If You Have Bad Credit?

This credit report can bring bad news, of course. What if you see that you have bad credit and are going to struggle to get hold of a loan from a bank?

The first sensible piece of advice is to set about improving your credit score. This can usually be done by taking control of your financial situation. It can be a long and frustrating process but if you start paying back loans and cards on time your score will slowly start to rise.

If you need to borrow money in the mean-time then a no-credit check loan is ideal. This type of loan lets you get the money you need no matter what your credit report says.

Here at Hock Your Ride, we won’t ever check your credit history. So, we are able to offer you a loan regardless of whether you still have work to do on improving your score.


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