Just like your health you need to understand and take care of your credit file to keep it as healthy as possible. Even if you have good credit you can quickly find that excessive credit enquires can leave you with some unwanted baggage which can cause you dramas when applying for a loan for that dream item.
So how do you get a busy credit file?
It is simpler than you might think, applying for a phone contract, electricity, renting a new house - all these everyday things can leave an enquiry on your credit file. You might want to have a credit card as a backup so you apply for a few online to weigh up your options. Every time you apply for a credit card, car, mortgage online you can expect an enquiry on your file.
While several enquires is not inherently a bad thing, it is important to understand that this can change or alter the way a financier may view your application. Every credit enquiry you make leaves a mark on your credit file that any potential financier can see and use that information to make a decision.
What is the impact of a busy credit file?
While shopping around is generally considered the way to get the best deal, a customer can quickly find themselves restricted by it. With a busy credit file, it can be viewed as being “credit hungry” in the eyes of a potential lender and your risk of defaulting payments increases even though you may not have any blemishes on your credit history.
Essentially submitting multiple application to multiple lenders even if you do not accept their offer can make you seem less worthy of credit than another person in the same position with less enquires, purely for the fact that they may believe your chances of defaulting payments is higher.
A lender upon seeing a busy credit file will do one of 3 things. They will decline the application outright, request a sizeable deposit or the will look to offset the perceived risk with a higher interest rate.
If you have a busy credit file the only thing you can do to change it is wait. Enquires last for 5 years on your credit file but even a short period of no enquires can do the world of good to your credit outlook. The problem with waiting though is that sometimes it is not an option you need a car now.
How do you get the best deal without impacting my credit file?
The best way to shop around for a good deal on your car loan is to go to a broker, like Kiwi Car Loans. We have access to a long list of different lenders and search through all of them to find the best deal for you based on your profile, before submitting your application, thereby minimising the number of enquiries that are put on your credit file. It saves you time, money and stops you from getting a busy recent credit file.
Wait until you are ready
While using a Kiwi Car Loans Finance Consultant means your credit file will not be impacted with lots of enquires, if you start looking before you are ready go, you will still end up with enquiries left on your credit file. If you do this several times in a short period, or decide to use multiple brokers then you will still end up with a busy recent credit history – facing the same problems you would if you had chosen to apply to multiple lenders for finance at the same time.
By submitting an online application or filling out one application form, one of Kiwi Car Loans consultants will guide you through the entire process and get the best deal for you without damaging your credit file. We can give you multiple options so you can select what best suits your lifestyle and needs.
Speak to your Kiwi Car Loans Finance Consultant today on 0800 008 888 for more information or simply get your obligation-free 60 Second Quick Quote now.
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