The importance of obtaining a credit check before applying for a loan and regularly monitoring your credit report.
Before applying for a loan, checking your own credit report is one of the smartest financial moves you can make. Your credit history plays a major role in whether you’re approved for a loan and the terms you're offered. By reviewing your credit report beforehand, you can see exactly what a lender would see—giving you the chance to understand where you stand financially and if required, fix any problems before they impact your loan application.
Common issues Simaco Partners, through it's broker arm, Simaco Finance, have seen impact loan applications, include having some of the following on your credit report:
- paid and unpaid defaults.
- Dishonoured payments or missed minimum repayments on credit card or loan accounts.
- Significant searches from collection agencies and banks.
A self-conducted credit search is usually available for free periodically from a number of credit reporting agencies (refer this link for an example from equifax, current as of the date of this article). These searches allow you to identify any errors or inaccuracies on your report that could negatively impact your credit score. Along with the above examples, mistakes like outdated information, duplicate accounts, or even fraudulent activity can all drag down your score, and disputing them ahead of time could significantly reduce the risk they could impact your application. This proactive step can mean the difference between being approved and declined.
Reviewing your credit also helps you prepare more effectively for the loan application process. You’ll be able to estimate what types of credit you’re likely to qualify for, identify old accounts that should be resolved (e.g. credit cards) and avoid applying for loans that are out of reach - which could further damage your score due to hard credit inquiries. This knowledge empowers you to approach lenders with confidence.
Finally, completing a credit search on yourself signals responsible financial behavior and that your serious to your broker. It shows you’re serious about managing your credit and making informed borrowing decisions. In a world where your credit score affects not only loans but things like rental applications and insurance premiums, staying on top of your credit is a habit that pays off.
Feel free to contact Simaco Finance, Simaco Partners' broking practice today for any loan enquiries you may have.
Please note: the above is general advice or commentary only, does not consider your personal circumstances and should accordingly not be solely relied upon. Before progressing a loan or investing in a financial product, we recommend you obtain suitable credit, tax, legal and/or financial advice and read any applicable PDS or FSG or other appropriate documentation before proceeding, ensuring that it takes into account your personal circumstances. Simaco Partners accepts no liability for reliance on the above or anything on its website. If you have any questions, contact our office.
Simaco Financial Advice is the trading name of Direct Financial Advice Pty Ltd which is the trustee of the Simaco Financial Advice Unit Trust ABN 91 753 408 234. This company and Stephen George Nikolovski are Authorised Representatives of Lifespan Financial Planning Pty Ltd ABN 23 065 921 735 Australian Financial Services Licence 229892. Stephen Nikolovski is an accredited broker and operates through Simaco Finance, the trading name of Direct Finance Solutions Pty Ltd. Stephen George Nikolovski is a MFAA Approved Broker (number 386328) and is a credit representative (number 500383) of BLSSA Pty Ltd, ACN 117 651 760 (Australian Credit License 391237). Disclaimer: The above is merely general commentary and is not a statement of fact or assertion of expected outcomes. It does not consider your personal circumstances. Please consider whether any proposed credit contract and what structure of loan (e.g. fixed or variable etc.) is appropriate for you and read any relevant disclosure statements and/or speak to an appropriately qualified legal professional / seek financial advice before proceeding with any course of action. If you wish to discuss your personal circumstances further, please again feel free to contact this office.
