As personal loan brokers at Smartline Rockingham, we see a lot of credit reports. Your credit report is extremely important because it is one of the biggest factors lenders use when they decide whether to extend credit, how much to extend and what interest rate to charge you. If your credit report isn’t favourable, you are going to have a harder time getting a loan and pay more interest when you do.
Here are some steps you can take to cleaning up some of your debts and improving your credit report.
Create a Budget
Figure out your income and your “outgo” for every month. Tally up all of your debts and your assets. After the payments you have to make every month, figure out how much more you can squeeze out of your monthly income to start paying debts off faster. If you are having trouble creating a budget, there are plenty of budget templates online. Download whichever one looks right for you and start using it.
Paying off Debts
If you have any delinquent debt, start paying it first. This is the debt that looks the worst on your credit report. After you have taken care of delinquencies, there are two methods most commonly used. Both involve paying off one debt at a time.
We recommend paying off the loans with highest rates, such as store cards and credit cards, first. This is the fastest way to lower your debt. If you have trouble with motivation or if all of your debt has roughly equal interest rates, you may want to pay the smallest debts first. This will give you a sense of achievement and motivate you to pay more debts.
Personal Loan for Debt Consolidation
If you have a lot of high interest loans but your credit score is reasonable, you may qualify for a personal loan for debt consolidation. At Smartline Rockingham, we have access to 28 lenders to put the odds more in your favour.
To learn more or to talk to one of our personal loan brokers, call Smartline Rockingham today: (08) 9527 1800