Many people avoid checking their credit scores too often out of fear it may have a negative impact, however, that’s not necessarily the case. Keeping an eye on your credit health through a routine credit health check is a great way to ensure the information being stored is accurate, and that you’re on track. Checking your own credit history is called a soft inquiry, which has no effect. This is the same for when an employer, bank, or real estate checks your credit history as well. However, there are hard inquiries that can have an effect on your credit health. Checking your score regularly will give you a better idea of where your credit health is at, meaning when it comes time to apply for a new loan or credit account, you’ll be on top of your current information.
By completing a regular or annual credit score check it gives you time to address any potential issues that could have an effect on your credit score. In this blog, we’ll be talking about the benefits of checking your credit regularly, and why it’s important to keep on top of it.
Why You Should Check Your Credit Health
Know What Lenders Will See
If you’re preparing to make a large purchase, such as a house or a vehicle, and you’re needing to apply for credit, preparing in advance is imperative. Checking your credit reports will allow you to get an idea of what future lenders are going to see when undertaking a hard inquiry – this gives you time to build your score some more so that it presents positively when the time comes to make your purchase.
Ensures That Accounts are Reported Correctly
You want to make sure that lenders and creditors are reporting your payment history in the correct manner, and regular checks will give you the opportunity to pick up on any mistakes. This will also allow you to make changes to any old information that may be considered negative – such as bankruptcies and late payments, ensuring they are removed from your record when the relevant timeframe has passed.
What is a Soft & Hard Credit Health Check?
If you’re unsure about the terms ‘soft inquiry’ and ‘hard inquiry’ they both have similar, but different meanings. When you request a copy of your credit report, or you check your credit scores online yourself, this is considered a soft inquiry. These do not have any effect on the health of your credit score and are not visible to lenders when they review your reports. However, they are and will remain visible to you for anywhere up to 24 months.
A hard inquiry does affect your credit score, but if you’re making a large purchase and taking the time to look for the best rates, these sorts of inquiries will generally be reported as one hard inquiry for a certain period of time. This is done so that people can shop for different lenders that offer the most competitive rates that best suit their lifestyle or financial position.
If you’ve recently done a routine credit health check and you’re needing to improve your credit score, there are a few things you can do over a period of time to get it looking good again. This will help you in the future when you decide to buy a house, secure a mortgage, or purchase a car. Here are a couple of tips to get you started:
- Catch up on any overdue payments by paying your debts on time
- Keep your credit card balances low
- Ask a family member to add you as an authorised user on their credit card account (if they have a positive credit score)
- Do not apply for new credit unless you really need it
Speak with a MediPro Broker Today!
Happy with your recent or annual credit score check? Contact us today on 1300 375 626 for assistance with an array of loan solutions. At MediPro Capital Finance, we ensure we secure loans for our medical customers at the best rates on the market. For any questions or for more information, get in touch online now!
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