A clean credit rating is what every earning person desires. Being able to spend the money you make while obtaining easy credit allows you to enjoy life the way you want. In Australia, a clean credit rating is now more important than ever. The financial system has undergone a transition where positive credit information will now be reported for each consumer. Previously, only negative items were reported. So now whenever your credit history will be screened, the credit rating would be analysed in light of both negative and positive items.
The foremost advantage of having a clean credit rating is that you have access to a variety of credit options. Otherwise, your options are limited and you have to stick to what is available. You can choose a credit line that suits your needs and reduce your credit burden. Not having the ability to secure credit in today’s day and age can limit your spending.
Generally, credit providers favour consumers who have a clean credit rating. Credit providers can be divided into two categories, the conforming and the non-conforming.
Conforming Credit Providers: Conforming Credit Providers are rigid in their screening process and usually do not approve credit for applicants who don’t have a clean credit rating. This is often the case when you apply for a bank loan. If a bank or lender has conservative criteria for determining whether or not the loan should be approved, you are quite likely to be rejected if you don’t have a clean credit rating. Conforming lenders charge lower fees and offer lower interest rates to borrowers with a clean credit rating.
Non-Conforming Credit Providers: On the other hand, non-conforming lenders may provide you the credit you need but the fees and interest they charge may be higher because of your bad credit rating. This is because a client with a bad credit rating is seen as a higher risk to a lender.
What this means is that you may secure credit without a clean credit rating but the associated terms and conditions might not be in your favour. In addition, having a clean credit rating ensures the process is completed quicker.
You will find a clean credit rating particularly helpful when:
- Seeking a job
- Borrowing money
- Buying or renting a home
- Financing a car
- Applying for a credit card
- Making expensive purchases
If you don’t have a clean credit rating, you might not be able to afford any of the above. Don’t worry if your credit rating is not up to the mark. A credit repair company like Clean Credit can help. There are many ways in which we can help repair your credit rating and get your financial record back on track.
Call us today on 1300 015 210 for a free consultation and find out how we can help you repair your credit rating.