Australians are making credit card purchases now more than ever. In 2017, there were over 16 million credit cards in Australia, and Australians spent a total of $315.6 billion using credit cards.

Needless to say, credit is a popular topic. However, it’s also something many Australians stress about regularly. Understanding what information is in a credit file can answer many questions related to credit woes, and Credit Simple is here to help.

The good

That’s right—there can be positive information on your credit file. Australia recently made a change to add more information to credit files, referred to as Comprehensive Credit Reporting (CCR). This new system allows lenders to view your entire credit history, including all of the good stuff you’ve done related to your credit — for example, if you paid off a credit card in full or continue to make regular, on-time payments.

This way, the positive things you’ve done could outweigh anything negative when lenders are assessing your file. Additionally, if you have only had credit for a short period of time, it can also help you to have a comprehensive report because even the small steps you’ve taken in that short amount of time will beef up your credit history.

Comprehensive credit reporting allows lenders to have a well-balanced perspective of your ability to take on new lines of credit. (Want to know more? Download our free ebook here.)

The bad

Unfortunately, there may be negative items on your credit file as well, which can lower your credit score and give lenders pause. While not always negative, information can include any current lines of credit you have and the respective credit liability information for each, and the number of loan or credit card applications you’ve submitted, which can be a negative thing if you’ve been applying too much. This includes any commercial loans you’ve applied for.

In your credit report you will also find any defaults or credit infringements, debt agreements, late payments, and any overdue fines. Keep in mind that even if you have now paid an overdue bill, lenders can still see that it was overdue previously.

If you have any joint applications, or have signed as a guarantor on a loan, these details will also show up on your report. And any credit report requests that lenders have made will show up on your file.

The rest

There will also be personal information in your credit report. This will include your name, addresses (current and previous), date of birth, and employment and driver’s licence number. ASIC recommends being wary of sites that ask for your credit card information to give you a free credit score, and to watch out for scammers who are just trying to get personal details from you.

You can find lots more information about your credit score on our site, or click here to check your credit score and see if you have a clear score.

The post What exactly is in your credit file? appeared first on Credit Simple.

Credit card usage has become ubiquitous worldwide, even among those who want to get a clear score. In Australia alone, we have accrued around $32 billion in credit card debt to date. Statistics also show that from 2010 to 2017, the average credit card purchase went up from eight purchases a month to 13.

With the increase of credit card usage in Australia, there has also come additional stress. The Australian Securities and Investments Commission (ASIC) conducted a survey about financial attitudes which found that 36 per cent of respondents felt stressed or overwhelmed when dealing with money.

To fully understand how to manage credit card debt and finances overall, it’s crucial to understand common credit score terminology. Here is a brief credit score glossary to look at some of the most popular credit score terms, with some help from the ASIC glossary.

Clear score

What does it mean to have a clear score? Credit Simple credit scores run from zero to 1,000. A clear score is more than 500. A good credit score is around 600-700. And an outstanding score is more than 900. You can read more on our blog about how to get a clear score.

Credit contract

A credit contract is made up of the terms and conditions that you agree to with a credit provider. This document, which is a requirement from the credit provider, includes the term, interest rate, fees, and other details of your loan.

Credit file

A credit file is held by a credit reporting agency, details your full credit history, and is used by lenders to make the decision of whether or not to approve a credit application. Every credit enquiry you have made, every default on repayment, and every late bill payment are all examples of the records on your credit file.

Credit guide

A credit guide is not the same as a credit contract. A guide is essentially all the information you need about the lender and the costs of loans they offer. Other information can include the lender’s licence number and external dispute resolution scheme membership.

Credit report

Also known as a credit reference, a credit report details your full credit history. This includes every application you have submitted for a line of credit, as well as if you have defaulted on payment. Credit reports are generated from a credit reporting agency.

Credit limit

Your credit limit on a given line of credit is the maximum amount you can borrow from that lender. Your credit limit can often be raised if you have made your payments on time.

Credit rating

A credit rating is also referred to as a credit score. This is the number you are given based on your credit history—your borrowing and repayment history. The details on your credit report or credit file inform your overall credit rating.

You can find more helpful information about credit scores on our site, or click here to check your credit score and see if you’ve got a clear score.

The post Want a clear score? Knowledge is power. Make sure you know your credit terminology appeared first on Credit Simple.