A recent study has shown that residents living in inner Sydney and inner Melbourne have some of the worst credit ratings in Australia. While the national average VedaScore is 760, inner Sydney scored an average of 722 and inner Melbourne scored 724. This means that the people living in the heart of these two major cities have low credit rating on their credit scores. With more and more people having financial stress these days, it’s important to have good credit rating to get any financial stability.
Importance of a Good Credit Rating
Why is there a need to establish a good credit rating? Having a good credit rating proves that you are able to pay your obligations on time. Borrowing money is easy and loan applications are approved much faster simply because lenders are confident that you can make payments on time. By looking at your credit rating, lenders can assess whether you are a high risk borrower or not. Credit reports are a good source of credit information. These reports show if you missed a payment or if you pay on time and other details that every lender needs to know when it comes to your credit history.
Do you skip credit card payments? Do you miss payments? Whether you did it on purpose or you missed it unintentionally your payment record will show if you make payments on time. Some find it hard to pay on time because of various reasons. There are few people who can manage and settle their accounts. While others juggle their money on education, monthly bills, food, rent, amortizations and other loans that they pay on a monthly basis. Some take their credit rating for granted, which is not good either. If you want to establish your credit rating then you should pay attention to your method of payment. Paying on time earns you extra points and it shows on your credit history.
Some have bad credit because of numerous schedules of payments that they have every month. Due dates vary and this is probably the main reason why some forget to pay their monthly obligations. It is quite hard to manage all of these especially if you have more than three loans. You need to have a monitoring system for these accounts or have a calendar for it so you don’t miss any payments. Go over it regularly so you can make a budget and pay your obligations on or before the due date. It is much easier this way rather than waiting for reminders in form of text messages, phone calls, emails or bills that arrive at your doorstep. It is their job to remind you of your obligation but it is best if you make your own list so you can pay ahead of time. Paying before the due date enhances your credit rating. Most people often don’t pay much attention to their credit history, but it’s time to make a change and start boosting your credit rating.