Читать книгу Sort Your Money Out - Glen James - Страница 35

‘Will paying off my debt affect my credit score?’

‘My credit score is important!’

‘How do I increase my credit score?’

‘I need to get a loan to get a credit score!’

These are common statements that I have heard or that may have slipped out of your own mouth. Australia is heavily influenced by the USA in its culture, and their society and financial system is built on the back of the credit score system. In the USA, you need a credit check for house rentals, car insurance, home insurance, health insurance and even some online dating profiles! It's everywhere! And the concern about credit scores has crept into Australia. Let's break this down.

Here's why you shouldn't worry too much about credit scores.

There is no national credit score system in Australia that is magically linked to your tax file number (or anything like that). There are three main credit record agencies (or credit bureaus) in Australia: Equifax, Illion and Experian. Each bureau may have a record of you and their own profile from which they assess and produce a score for you. Generally, your record with these bureaus has your current or most recent home address (as well as previous addresses), date of birth, full name, and so on.

Credit providers such as banks, electricity companies, phone companies, other utility providers (or anywhere that you borrow money or are on a use-now-pay-later account, such as an internet plan) may choose one, two or all bureaus to work with. For example, if you didn't pay your phone bill on time, it's possible only Illion got a notification, placing a negative mark on your ‘credit’ file.

When applying for a loan or mortgage (remember that you won't be applying for any consumer debt going forward!) the credit provider may sweep one or all of the bureaus to gather data about your history of repaying money. At this point they will make their own judgement and assess how creditworthy you are.

Let me repeat that: banks and lenders don't have access to a central credit score government-owned database … these bureaus are non-government (i.e. private companies).

So what does this mean? It means that the proposed credit provider (e.g. for a phone plan or home loan) will gather credit information from one or all of these companies and build their own credit profile on you. This means there is no huge issue with your specific ‘credit score’. I live and breathe personal finance daily for a living and I honestly don't know what my ‘made-up score’ is with any of the bureaus. I don't let this myth run my life.

Bottom line: the best thing to do regarding your personal credit history is to pay your bills on time and have cash in the bank!