December newsletter
How to prepare for new lending laws
Posted on Tuesday, November 24 2009 at 10:00 AM
New consumer credit laws taking effect this month give lenders wider powers to check borrowers' credit history. What do borrowers need to do to stay ahead of the game under the new regime?
RateCity chief executive Damian Smith says lenders will have broader access to check consumers' credit history records, such as utility bills, leading to fears "that some lenders may use this level of information against borrowers to determine their interest rates".
RateCity provides the following four tips for consumers on how to prepare for the new laws:
- Get your credit history in order and lose bad financial habits. Try to lower your debts. If you have more than one credit card debt, compare consolidation loans with credit cards, as you may be able to save a lot of money and pay off your debts sooner.
- Try to pay all your bills on time. Most debit accounts have a free automatic payment feature that allows you to pay your bills without manually transferring your money.
- Keep track of when your bills are scheduled to be paid and make sure you have a buffer in your account so you don't get caught with heavy overdraft fees. Keep records of how much you earn, what you spend, and learn about approval processes before applying for a loan.
- Shop around for loans and compare deals on flexibility, features and price. This will provide you with the tools to negotiate a better deal when a lender has more access to your credit habits.
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