November 6, 2020

3D rendering, coronavirus cells covid-19 influenza flowing on grey gradient background as dangerous flu strain cases as a pandemic medical health risk concept of disease cells risk

Don’t Let Covid 19 Disrupt Your Credit File.

Covid 19 has disrupted our daily lives.

The COVID 19 virus has meant changes to employment, often a reduction in income.

Covid 19 has disrupted our daily lives

The virus has caused  financial hardship for business owners and employees.

These changes can often impact your mental health.

Obviously this can be due to the uncertaintyof  your employment.

But the lack of/or reduction in income can impact an otherwise mentally healthy person..

The inability to visit family interstate and overseas adds to this anxiety.

Meeting Your financial Commitments.

If you are struggling to meet repayments on your loans and financial commitments:

1. Call the lenders involved as early as possible.
2. Check what support is available from the government.
3. Many lenders now have COVID-19 hardship provisions in place.
4. Contact them while they are offering payment deferrals..
5. What can I do if I cannot pay my private health insurance?
6. Most private health insurers are offering members the ability to suspend their payments, pay partial payments or suspend their membership temporarily.                                                                                                                                                                                 Please check the conditions in your policy or with your insurer.                                                                                                                      Because you may not be covered for benefits if your membership has been suspended.
7. Private health cover is not needed for COVID -19 treatment.
8. COVID testing and treatment for the virus covered by Medicare.

Will COVID-19 related issues impact my credit score?

Covid 19 has disrupted our daily lives.

This will depend on how the lenders report any arrears to the credit reporting bodies.

Your loan repayments are shown on your credit report.

This forms a part of your repayment history information.

Accordingly making your payments on or before the due date each month has a positive impact on your credit score.

Lenders can see that you pay on time.

Missed payments can negatively impact on your credit score.

There are some steps you can take to minimise any future impact on your credit score:

Call the lenders in advance of having a problem.

Check what assistance they are willing to provide.
It is better to pay something, pay what you can at the time.

Despite being in arrears the reality is that you should be able to make a temporary arrangement with your lender.

Unless you were already in arrears prior to Covid 19, the lender is likely to accept a lower amount each month.

Until your circumstances improve.

Does a payment arrangement affect my credit score?

I have arranged a ‘payment deferral’ arrangement with my finance company will this impact my credit score?

Most lenders are working to ensure consumers are helped through this period.

If you are up to date with payments and then enter into a payment deferral, lenders will show the repayment history information as up to date.

Covid 19 has disrupted our daily lives

Check with your lender as to what their policy is.

If your lender reports this as a 0 or up to date there will be no impact to your credit file, it will be as if account is up to date.

If you are in arrears  when you request a ‘payment deferral’ a lender may supply the information as not reported.

Therefore in this situation the Equifax Score will remain neutral.

Generally there may be some improvement in the score over time (provided all other factors remain the same).

What can I do to protect my credit worthiness?

It may be time to look at downsizing or lessening your expenditure.

Look at your lifestyle, ask yourself what expense can I do without or get rid of?

Create or review your household budget, take advice of the financial help available.

Disclaimer: The information contained in this article is of a general nature.

Since we do not know or consider your personal financial goals, objectives, financial situation or needs.

Accordingly you should consider if the information is appropriate to your circumstances.

Therefore you should seek professional advice before acting on it.

Check this article.https://www.wacars.com.au/2020/08/18/10-ways-improve-credit-score/