How can I rebuild my credit score?

A bad credit report could prevent you from accessing home loan products. All is not lost though, as there are several things you can do to repair your credit.

When you’re applying for a mortgage you want to secure the lowest interest rate you can — the difference of just half a percentage point can mean tens of thousands of dollars extra in interest over the life of your loan. Therefore it’s important to present yourself in the best possible light to lenders. They need to feel assured that:

  • your personal financial management is good, and
  • your risk of default on your home loan is low. To assess your application, they will look closely at your credit score. Every mark counts against you and could lead to you being offered a higher interest rate (to offset their risk of lending to you), or having your loan application rejected. Both would be unfortunate scenarios. Every application adds an enquiry to your credit score, so a rejection would further damage your credit report and potentially make other lenders wary of lending to you. As a result, it’s important to do what you can to repair your credit before applying for a mortgage. There are two ways of doing this: clean up your credit file yourself, or engage a credit repair company.

How can I fix my credit myself?

The best way of doing this is to get on top of your finances. Here are some general tips:

  • Set a budget and stick to it.
  • Make all your payments on time.
  • Pay off your credit cards each month.
  • Reduce your use of credit cards (credit utilisation should be low relative to your credit card limit, so lower your usage not your limit).
  • Keep credit cards open to demonstrate low utilisation and a credit history.
  • Avoid applying for new lines of credit.
  • Get a copy of your credit report and check it for any errors that you can dispute. To access a standard home loan with a good rate, you will usually need to pay all defaults so they are no longer on your credit file, and have made all debt repayments for at least six months. It’s a good idea to stay up-to-date with your credit report and clean it up, if necessary, before you apply for a home loan so you can get the best rate possible.

What leads to bad credit?

While black marks on your credit report generally stem from defaulting on payments, other causes can include:

  • Identity theft;
  • Disagreements with your lender or credit provider;
  • Mistakes on the part of your lender.

What does a credit repair company do?

Credit repair companies seek to remove contentious or unfair black marks from your credit report to improve your credit report and help you access more home loan products.

How can credit repair services help?

There are several processes that creditors must follow when recording a black mark on your credit report. However, some of them fail to follow these processes when listing a default on your report. A credit repair service can help you find these arguable black marks and try to get them removed from your report. You’ll benefit from this in several ways:

  • Lenders may offer you lower interest rates if you have a clean credit report.
  • You increase your chances of getting your loan application approved.
  • You gain access to more credit and home loan products.
  • Lenders may reduce their fees.
  • Your credit report becomes a more accurate representation of your credit history.

How does credit repair work?

Your credit repair company will obtain your credit report, usually from a national credit-reporting agency, such as Experian, Veda or D&B. This allows them access to the listings on your credit report to identify the black marks they need to investigate. The company will then work with you to find out if any of these black marks were processed incorrectly. A creditor must do all of the following when creating a black mark on your credit report: Send a final bill; Wait for at least 30 days after sending the final bill before sending a formal demand letter. This must contain accurate information on:

  • the amount you owe,
  • the time you have to repay,
  • the repayment methods available,
  • that your creditor intends to create a default on your credit report if you don’t meet your obligations; Wait a further 30 days after sending the formal demand letter before creating a black mark on your credit report. Your credit repair company will examine the documents you received from your creditor to ensure they followed the correct procedures. If they haven’t, your company will contact the creditor to inform them of the breach and attempt to get the black mark removed. You can undertake this process and fix your credit yourself. However, you may find your chances of success decrease if the creditor contests your request to have the default removed.

What can credit repairers remove from my credit report?

It depends on your situation, but a credit repair company can remove any black marks for which the creditor did not follow the proper processes. This means you may be able to remove any or all of the following:

  • Court listings and judgements;
  • Defaults;
  • Overdue payments;
  • Crossed files;
  • Clear outs. There are several other things a credit repair company could help with, so it’s best to speak to them directly. Each black mark that gets removed improves your credit rating.

Repair credit or refinance?

Some people choose to refinance their existing home loans rather than repair their credit reports. This will only benefit you if you have built a large amount of equity in your home. In such cases, lenders may overlook credit issues and still offer low rates. If you don’t have equity, credit repair improves your chances of getting a good rate.

What to do next

While credit repair services will cost you money in the short term, they also offer access to long-term savings on your home loan. Before you get started, you should:

  • Read about refinancing as a possible alternative to credit repair;
  • Find out if you could save money through refinancing;
  • Live chat with one of our home loan brokers. With Alexi NeocleousThe information in this article is general in nature. Please seek advice from a licensed professional when making financial decisions.Book a call in with UNO

Book Call Now

UNO home loans

Need help with your home loan?

UNO Brokers are available night and day for a quick review or your situation and bring expertise that will support better decision making that will save you time and money. Book in a quick call when it suits your busy schedule

Get Started

Related Articles


What our customers are saying

Sally Mackenzie
February 19, 2024
We chose Uno Home Loans from their impressive web site knowing we were going to find it hard, on many fronts, to qualify for a home loan. We were incredibly fortunate to be assigned Mike Parsons as right from the get-go, despite the complexities, he hit the ground running for us. He was incredibly knowledgeable, with years of experience but what was immediately apparent and impressive was that he was totally invested in getting us over the line, doing absolutely everything possible, including working around the clock. Despite it being a relatively small loan in the order of things, Mike never missed a beat, getting docs ready, following up and answering every request from the proposed funder immediately. He kept us informed on progress the minute anything happened, and again if anything needed to be done, he was right on it. In short, we highly recommend Uno, and Mike, knowing what a remarkable job he did, over many weeks, to get us our loan. He got us a great deal, with far better rates than we expected, so we couldn't be happier. In fact, without doubt, you'd be hard pressed to find a more personable, sharp, hard working, dedicated professional who clearly prides himself on getting his customers standout results.
Read more
February 13, 2024
Scott and his team were just A-mazing. We felt supported through the whole process with the greatest quality and care. Every question answered right in time, or even before we asked. The process was smooth and we got the best outcomes we could have wished for.
Read more
Angela Biddle
February 6, 2024
Our mortgage recently came up for renewal, and with interest rates skyrocketing we were looking for ways to minimise the impact. Michael and his team were proactive and attentive. Michael spent time with us to understand our circumstances. He found mortgage options that worked with our current financial situation and longer investment plans. He presented clear options, providing guidance where needed. He and his team were helpful and responsive - streamlining the process and keeping us updated through the negotiations. In the end, Uno did the heavy lifting and secured a significantly better rate than our current bank offered, all with friendly, personal service. We would highly recommend UNO Home Loans.
Read more
Fotis Bikas
January 15, 2024
I cannot help but congratulate Scott Wilkinson of UNO Home Loans for being an absolute credit to both his company and the entire loans industry. Scott is a truly rare gem of a broker in that he will not only go the extra mile to achieve for each customer the very best deal, but his knowledge of all and sundry within the industry is unsurpassed (you will see what I mean if you speak to him). Additionally, Scott has a clear passion for imparting his wealth of information with each customer, whereas the conversation with most other brokers would simply be over if they could not get you the best deal. For me, Scott Wilkinson of UNO Home Loans stands head and shoulders above the competition and I feel privileged to benefit both from his expertise and professionalism whenever it is time for a refinance or new loan.
Read more
Tomoharu Matsui
January 11, 2024
Michael Parsons helped me a lot when it's difficult to establish my capabilities in loan.
Read more
Gillian Kearon
January 9, 2024
I highly recommend Mike Parsons as a mortgage broker. I couldn't fault the service provided by UNO. Thanks Mike!
Read more
Taner T
December 20, 2023
Thank you Eren Tan for the amazing service and support. Our Loan was a little tricky and complex for other lenders but Eren managed to get it over the line in record time. His professionalism and dedication to our needs was exceptional. If you need a Loan no matter how complex your situation, make sure you contact Eren at UNO Home Loans.
Read more
Karaipu Brown
December 20, 2023
Buying & selling a house at the same time is very stressful but Scott Wilkinson from UNO home loans made sure we knew what was happening & took most of the stress away. He always kept us up to date and if we had a concern or wanted clarification on something we were able to call him, if he didn’t know the answer straight away he will find out and contact us back.. now we are enjoying our new house and turning it into a home :)
Read more
Chris Anderson
December 18, 2023
Just completed my first loan with UNO which was so much easier than with other other brokers I have used in the past. Our broker MIKE PARSONS always had time for me and broke things down for me in the simplest of terms and was very patient with my silly questions and my constant changing of plans. I wish I had used them in the past as I wouldn't be in the situation I'm in now. Can't recommend them highly enough. Thanks UNO and Thanks MIKE 😊
Read more
Stephen Broomfield
December 11, 2023
To be able to recommend Scott Wilkinson for your mortgage broker was a privilege. We had deals fall through but Scott supported, guided and stuck with us, proper partnership. The whole team at UNO helped us and supported us right through to after settlement. Made sure everything was correct and how we are progressing. Communication was amazing and straightforward and easy to understand. Transparent. We can not Recommend Scott and the team as Uno high enough. Use UNO with confidence.
Read more
Tarek Hussain
December 6, 2023
Can't thank Amy enough for her hard work, dedication and determination on getting multiple loans completed for me. I wouldn't hesitate in recommending Amy and the Uno team to any of my associates. Will definitely be back in the near future!
Read more
November 3, 2023
If you’re looking for a trustworthy, thorough, reliable & knowledgeable Mortgage Broker then you must call Anita Callaghan! I can’t even imagine how stressful this process would’ve been without her. Anita went above and beyond to make sure she answered every question, responded to every text (even on weekends/after hours), and followed up on every detail to ensure we had all the info we needed. Anita is a true people person who is warm, empathetic, kind and supportive. You can tell she loves helping people and loves what she does, which is probably why she’s so good at it! Can’t thank you enough Anita, or recommend you more highly! You’re the best!
Read more