Buying a house probably ranks amongst the most important and exciting things a person will ever do over the course of their lifetime but unless you are lucky enough to be independently wealthy, you will probably need a home loan to get your foot on the property ladder.

Unfortunately, many people get refused this all important home loan due to a poor credit record. This can be absolutely heartbreaking but with time, patience and discipline you can turn your credit history around and get that all important home loan.Banks and other traditional lending organisations have strict and some might say archaic ways of working when it comes to home loans. The self-employed especially can have a hard time convincing the lenders that they are capable of repaying the loan on time every single month.

These stringent measures imposed by banks and the like are not particularly helpful in providing you with information as to how you can improve your credit score.As a result, more and more people across Australia, for example, are taking advantage of the help offered by companies outside of the traditional lending institutions such as independent mortgage brokers in Sydney. Independent mortgage brokers have access to literally hundreds of lenders who may have less stringent conditions. In any case, if you have a poor credit history it doesn’t harm you to improve it. Please see below for a few of the ways you can improve your credit history in the eyes of lenders.

Improving Your Credit Score

Below are just a few of the ways you can improve your credit score. As previously mentioned, it might take time and you will need to discipline yourself if you are accustomed to a more carefree financial lifestyle.

#1 Paying Bills On Time

This may sound obvious but paying your bills on time every time does enhance your credit rating. Having a consistent record of punctual payments clearly show lenders you possess fiscal discipline. Defaulting on a payment can and will have the opposite effect.

#2 Don’t Apply For New Credit

Unless you are 100% debt-free it is a bad idea to apply for any new credit. Put off the new car, kitchen or long haul holiday until all your debts are paid. Your credit score will thank you for it.

#3 Making Debt And Loan Repayment A Priority

If you are committed to getting that home loan application approved, make repaying loans and debts a priority. Borrow from friends and family if necessary or possible.

#4 Keep Your Credit Card Balance Low

In this day and age we all need a credit card. In fact, many retailers have stopped accepting cash payments, so this makes some sort of card essential. If at all possible, keep your balance as low as possible and pay off the whole amount every month. If you have a high balance outstanding, it might be worth changing credit card provider to one that provides an interest free balance transfer.

If you can stick rigidly to the points detailed above, your credit score will improve over time and you significantly enhance your chances of being approved for a home loan.

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