What is a Credit Bureau?
Credit bureaus are government-approved agencies that collect, store, and compile information on your credit history. This includes loans, credit card applications, as well as repayment records.
Although monitoring your financial situation is one use of a credit report, its main significance lies in how credit providers use it to evaluate your creditworthiness. When deciding whether to approve your application for credit, like a personal loan, the majority of lenders will examine your credit report.
What is a Credit Bureau Report?
The members of the credit bureau provide the financial history in credit bureau reports that can be obtained from public sources. A credit bureau report generally includes the following details:
- Details of accounts owned by the individual as well as the account balance.
- Payment history including date of last activity and credit limits on accounts.
- Debt collections.
- Bankruptcies (if any) – for the last 5 years from the date of discharge. The Bankruptcy Order will be annulled and your bankruptcy record will be erased right away if you are able to pay off all of your obligations.
- Closed or terminated accounts (these are displayed for 3 years since the date of closing the account).
While these are some of the most basic and important factors, some companies may also consider other factors while evaluating your credit application.
What does your credit report matter?
This is how your credit score is determined. It indicates how likely you are to pay back your debts. A good credit repayment history makes it easier for you to obtain loans and credit cards with approval in the future.
Factors that can affect your credit bureau report
It’s not surprising that you need a clean and impressive credit history to gain approval for loans or other credit.
It’s good to plan, as financial missteps can have unwanted repercussions and spoil your chances of availing of loans from banks, credit facilities, and other financial institutions. You might even have to pay higher interest rates if your report isn’t very impressive and stable. So, keep an eye out for the factors that can impact your credit report, including;
- Current credit: The number of open or active credit accounts you have, which determines your available credit.
- Credit history: A long credit history indicates your credibility as a borrower.
- Inquiry activity: Too many new credit applications or inquiries may imply that you are trying to accumulate more debt. It’s advisable to avoid applying for a new credit card if you don’t need one.
- Recent credit: If you’ve recently acquired multiple new credit facilities within a brief period, it may suggest you are overextending yourself financially.
How can I get a copy of my credit report?
To find out your credit score, you can contact either the Credit Bureau Singapore or Experian Credit Bureau Singapore (ECBS).
How to request corrections in a credit bureau report?
If you disagree with some information in your credit report, you can write to the credit bureau about it along with relevant data to back your claim.
The bureau will then announce that the data in your report is being disputed and currently being investigated. If some amendments are made to the report, the bureau will share the report again with all the banks inquiring about you in the last three months.
