Keeping your credit score healthy means it’s easier to get approvals for credit cards, loans, financing, and even better interest rates for credit cards and repayment! Here’s how to improve your CCRIS (Central Credit Reference Information System) according to PropertyGuru.
Check your credit report regularly
You don’t need to do it daily, but every once in a while should suffice. The reason to check? Just so you’re always on your toes about your credit score and whether or not a new issue has appeared.
It could be anything from unpaid parking summons to a legal lawsuit filed against you. Always keep tabs on your credit report!
Build your credit history
With 2 magic words: Credit. Card. One of the lessons a friend shared when she bought her first home was, “Get a credit card. Because the banks need to check your credit score and whether you’re eligible for a loan.”
Which pretty much sums up how a credit card builds your credit history.
Although you may be great at handling your finances, credit-rating agencies will view a lack of credit history as negative, since there’s nothing on paper to actually show your financial/repayment history.
Have credit diversity
This one’s fairly easy to achieve and super beneficial! Have a diverse list of different loans and accounts in your credit score — include things like credit card loans, personal loans, car loans, etc.
The more diverse it is the better (just like Malaysia!) as only having one type of debt could negatively affect the points you earn for your credit score.
Rearrange your repayment timeframe
If you read your credit report and you start to notice a pattern of ‘1s’, it’s not a good sign. It means that you’re about a month behind repayments, although it’s not entirely your fault.
It could be because the due date for your payments are earlier than the date your salary is banked in. If that’s the case, it’s wise to rearrange the timeframe for repayment with your bank.
Based on the credit report example given above, the section marked ‘N’ has numbers that’re corresponding to the months — 2015 Nov with 3, 2015 Oct with 2, and 2015 Sept with 1. Each count of 1 equates to a month of unpaid repayment.
With this as an example, it shows that you’re behind 1 month of repayment for September, 2 months for October, and 3 months for November. The higher the number, the more debt you’re accumulating as you go.
Think twice about your financial relationships
Whether it’s a healthy relationship or a toxic one, you be the judge of it. In terms of financial relationships, we mean a relationship where two or more parties share finances.
It could be you taking a loan or acting as a guarantor on behalf of your parents or spouse, or even sharing payments with other people.
In the case that they delay — or worse — default payment, it will be reflected on YOUR credit score, badly.
So, if you’re a guarantor it gets worse x2 as they don’t pay = your responsibility, hence, adding to your debt burden.
