What Your Credit File Means for You
There is a lot of talk about your credit file these days. Every time you apply for a loan or credit card you have the enquiry on your file. It tells the date, the finance company you applied with credit for and the amount.
The most common issues we see are either multiple enquiries or defaults. Multiple enquiries usually come from people who go and see their bank for a home loan or car loan. Let’s say for example “Andrew” banks with Commonwealth Bank of Australia (CBA). He goes to CBA for a home loan, it all looks promising and they say lets apply as we can help you. Then it gets declined because for example Andrew has had a late payment on a credit card 3 months ago. Andrew has an account with ANZ from a few years ago so he then walks into ANZ. ANZ say it looks good so they apply and then it gets declined due to him not having savings in his bank long enough. Andrew then goes to a barbecue and his cousin says mate call Brenton from Dream Financing on 0423030533 he helped us into our house. Andrew rings me and I meet up with him. I tell him I wish he saw me first as I would have been able to tell him it did not fit with the other banks early on and give him some options. I put it to another lender which have advised Andrew’s situation is ok with then after I have workshopped the deal with the lenders. I cover off in my notes with them the reason for the decline with the other lenders and it gets approved however they are hesitant as they think CBA and ANZ know something they don’t and question the credit enquiries on his file.
Any more enquiries and almost certainly this would have not been approved. When you apply for loans with banks they always check your credit file. Some banks score your file and basically it automatically gets declined or approved depending on the score you receive. Other banks do not decline on the score however they still check, so as long as I cover of in my notes the other enquiries it can still be approved. This is why it is so important to see a broker who knows what they are doing. More often then not we obtain a better rate then customers can get by going direct anyway so it is even more imperative. If you have a default on your file whether it is paid or unpaid it will be automatically declined with some lenders depending on the amount the default is for. Everyone can check their credit file for free by going to http://www.mycreditfile.com.au/products-services/my-credit-file If you need it instantly there is a fee however if you are happy to wait up to 10 days it is free. I encourage everyone to check it if they are unsure.