4. When you’re looking to rent
We already know that having bad credit can make it difficult for you to secure a home loan. But even if you’re just looking to rent, your credit history can still pose problems.
In these trying times, landlords are more concerned than ever about finding a tenant who is going to pay their rent on time, so it is not uncommon for them to vet potential renters.
They will look through your credit history to assess how much of a financial risk you might pose. If you have poor credit health, you might have a tough time securing that rental that you desire. However, this may not be common among small-time residential property owners.
In this situation, a short-term option for you is to pay a more substantial amount of deposit, which can at least guarantee the landlord your tenancy for this period. In the long run, you will need to reassess your finances and work on improving your rating.
How to fix a bad credit report
Just like when your child is running a temperature, you would regularly check his/her temperature to see if he/she is recovering or deteriorating. Similarly, with your credit report, especially if you have a problem in your credit, you should regularly check it to see how well you are doing.
If you are working to build or rebuild credit, it is recommended that you check your credit report once every three months to ensure you are on the right track of recovery. Even if you have no issue with your credit, it pays to ensure your report is up-to-date and accurate by checking it before you apply for a credit facility such as a loan or a credit card, a new job, and it will also help you guard against identity theft and errors.
Checking your credit report is easy and convenient with CTOS. You can access your MyCTOS report to check if there are any red flags in the report that may impact your future credit applications. This can be done online and within three working hours.
The good news is, your credit report shows your credit history for the past 12 months. Hence, if you want to improve your credit rating, the first thing you need to do is to make sure you make all your payments to creditors on time and also pay down your credit for the next 12 months. This includes your bills and debts.
If you’re forced to miss a payment, be sure to inform the creditor and make the payment the following month. If you have outstanding defaults, pay them off as soon as you can.
To avoid glitches in your pursuit to purchase a car or a home, you should obtain your credit report from a credit reporting agency such as CTOS to make sure that everything is up-to-date and in order before you proceed. For instance, if you have paid a debt that was subject of a court judgement, make sure it is reflected on the file.
Need help on where to start? You may engage the Credit Counselling and Debt Management Agency (AKPK) for the financial management assistance that you require.