When applying for a loan in Australia, your credit report plays a crucial role in determining whether a lender will approve your application. Each lender has unique criteria, but their primary goal is to ensure you can repay the loan. Understanding what potential lenders do not want to see on your credit report is essential for maintaining a healthy credit profile.

Key Issues Lenders Do Not Want to See on Your Credit Report
Excessive Credit Enquiries
 
Many people believe shopping around for the best deal on credit cards is harmless. However, each credit enquiry is recorded on your credit report and remains for five years, even if you do not proceed with the application. A high number of credit enquiries can signal financial distress, which may deter lenders.
Late or Missed Payments
 
Consistently making late payments or ignoring bills altogether can significantly damage your credit score. Late Repayment history can affect your credit score by up to 35% and will remain on your credit report for 2 years.  If you novice Late Repayment History on your credit report, talk to We Fix Credit about what your options are to have this information removed. In some cases we can dispute the information and have it deleted from your credit file.
Defaults, defined as debts over $150 unpaid for more than 60 days, remain on your credit report for five years. These are major red flags for lenders, indicating a higher risk of non-repayment.
Minimum Payments on High Balances
 
Regularly making only minimum payments on high credit card balances (over 30% of your limit) suggests financial stress. Lenders view this as a risk factor, as it indicates you may be unable to manage your debt effectively, or reduce your serviceability, which can lead to a declined loan application.
 Cash Advances
 
Using cash advances from your credit card is often seen as a sign of financial desperation. These advances typically come with higher interest rates and can indicate to lenders that you are struggling financially.
Co-borrower Loans
 
Co-signing a loan increases your debt-to-income ratio and makes you liable if the primary borrower defaults.  This is because when you are a co-borrower for a loan, you are joint and severally liable for the payment of the loan. If the other co-borrower does not pay their repayment for what ever reason, you are required to pay the entire loan instalment. This extra debt can limit the amount lenders are willing to lend you and can affect your credit report if payments are missed.
Serious Credit Infringement or Clear-Out
 
A clear-out occurs when creditors cannot contact you despite reasonable efforts. These remain on your credit report for seven years and indicate avoidance of financial responsibilities, which is a serious concern for lenders.
Court Judgements
 
Court judgements show that legal action was required to collect a debt from you. Even if the debt is paid, the judgement will remain on your credit report for the balance of the 5 years from the date of Judgment, impacting your creditworthiness.
Bankruptcy
 
Applying for credit during bankruptcy is usually in fact illegal Lenders require a formal discharge letter from the court before considering your application, as they do not want their loan included in your bankruptcy proceedings. Furthermore, for 2 years after your bankruptcy is discharged, it remains listed on your credit file preventing you from having an actual credit score.
Navigating Credit Report Issues with We Fix Credit
In today’s cost of living crisis, being vigilant with borrowing practices is more critical than ever. Financial missteps can lead to significant issues on your credit report, hindering your ability to refinance or secure new loans at reasonable interest rates. If you notice any negative items on your credit report, it is crucial to address them promptly.
At We Fix Credit, we offer real credit repair solutions to help you navigate and address credit report issues. Our services are designed to help you remove adverse credit listings, such as defaults, court judgements, and other negative marks that may hinder your loan approval process. By working with us, you can rebuild your credit score and improve your chances of securing a conventional loan facility.
The Role of Credit Repair in Managing Financial Health
Effective credit repair involves more than just removing negative listings; it also includes educating individuals on maintaining healthy borrowing practices. During a cost of living crisis, this vigilance is paramount. Poor financial habits can lead to damaged credit reports, making it challenging to refinance or purchase when needed.
By partnering with We Fix Credit, you can take proactive steps to fix your credit score. We specialise in credit repair and offer comprehensive solutions tailored to your specific needs. Our team provides expert guidance and support, ensuring that you achieve real credit repair results.
Understanding what potential lenders do not want to see on your credit report is vital for maintaining a healthy credit profile. If you encounter any issues that may impact your creditworthiness, it is essential to seek professional assistance. We Fix Credit is here to help you navigate these challenges and provide effective credit repair solutions, ensuring that you can rebuild your credit score and secure the financial future you deserve.
Call We Fix Credit today on 1300 003 655 for a no obligation discussion to explore what you can do to improve and build your credit score.