Who Needs Credit Repair?

Who Needs Credit Repair?

Credit repair is becoming a popular option for borrowers who are behind on their payments. According to the Australian Bureau of Statistics, at least 29% of households are over-indebted. Those with mortgages are in even more danger of falling back on loans by 47%. Despite the stigmas surrounding it, the struggle with debt is more common than what most think.

Missing several payments on your loans could cause your Equifax scores to plummet. For reference, scores beyond 700 are considered good. Good scores are anywhere from 600-700. The average score is 550. 500 and below are considered very bad. Those who have a very bad score need credit repair.

This score is calculated through the following considerations:

  1. Basic information – Equifax will take into consideration your employment and income levels, as well as your status.
  2. Type of Credit – Some loans have a higher risk than others.
  3. Nature of Loan – Mortgages are considered a lower risk than personal loans like paydays advances and car financing.
  4. Enquiries – They consider the loans you’ve taken out within the last 5 years. People who take out a lot of loans in the given period are considered high-risk borrowers.
  5. Court Writs and Judgements – If you’ve failed to pay your debts more than once, lenders will issue court cases. This will go on your permanent record.
  6. History of Bankruptcy – Your Equifax score will go down to zero if you file for bankruptcy.

How is it fixed?

Low Equifax ratings can be detrimental to your borrowing options in the future. It can even affect your ability to rent or buy homes. Thankfully, there are ways to raise your scores. However, it’s not an easy path.

The best option for bad creditors is to seek help from a professional. Most will advise you to get a debt consolidation loan, in order to make payments easier. Credit repair professionals can renegotiate the payment plan and duration of your debt according to your income level.

Struggling with debt and bad credit? Repair your bad credit with Credit Repair Ausvengers today.