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[MoreMore Insights] Consumer Credit Rating


When providing individuals with a loan, banks and lenders will consider it a risky business, as the individual may not have the capacity to repay the loan on time, or not be able to repay it all together.


This is where credit report check and credit score comes in. A credit report is a comprehensive profile of your borrowing & credit history, stating every loan and their respective repayments that you have taken out and made.


Credit reporting agencies will use this history and calculate a credit score that indicates how risky it is for lenders to lend you money, reflecting how likely you are able to meet your repayment contributions.


This credit report and credit score are often used by banks, lenders and insurers to evaluate you in the lending process, and the use of this report can come in two forms:


1. Soft checks

  • Lenders will check your credit report just to confirm your credibility and riskiness. This will not affect your credit score

2. Hard checks

  • Lenders will require a comprehensive credit report from the credit reporting agencies, where this hard check ‘investigation’ will be recorded in your credit report and impact your overall credit score, especially when your credit application is rejected.

  • The reason why hard checks impact your credit score is that your credit inquiry indicates your increased need for loans, therefore making you more ‘risky’ to lend to. The more hard check inquiries there are in a short period of time, the lower your credit score will be.


Overall, you should be mindful when submitting credit applications, and avoid applying for multiple loans, credit cards and/or monthly contribution insurances all within a short time period.



For example, you should avoid applying for a mortgage with multiple lenders simultaneously and choose one at the end of the application process, as the multiple hard inquiries checked by all these lenders will significantly lower your credit score. Talk to your broker or shop around before applying will minimize impacts on your credit score.


Therefore, if you keep up with your incremental repayments, having only a few liabilities and a few hard inquiries, you will benefit from your healthy credit score as future lenders will consider you as a safe borrower, and you will receive the best rates across all lenders.


Have questions about your credit rating and ability to take out a loan?

MoreMore Finance can help you find the best home loan products based on your credit rating, reducing the need for multiple hard checks on your credit report.


Want to contact us today?


Please call 1300 613 813 for a free-cost consultation.


Or, simply fill the form [enquire now], we will go back to you in 24-hour.


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