Your Questions: My loan application was refused - how do I check my credit rating?
Question: I recently applied for a home improvement loan of €9,000 through my bank. I was shocked when I got a call telling me my loan has been denied due to a low credit score. I have been with my bank for over 10 years and have always had enough money coming in to meet my payments. I used my overdraft a bit more than usual over the last year, but it has always been repaid again when my wages go through. Can I check my credit rating somewhere, and how can I improve it?
Answer: A credit rating is something you could be unaware of for years until you go to get a mortgage or take out a personal loan and the credit or service provider tells you your application has to be reviewed further, or rejected.
This situation occurs more frequently than people realise, according to Kevin Johnson, who is the chief executive of CUDA (Credit Union Development Association).
There are a few essentials to establishing and maintaining a good credit rating.
You need to show that where you have taken out any credit in the past, you have paid on time and in full.
It's crucial that any late or missed payments are addressed immediately by talking to your lender to rectify the situation or come to an alternative arrangement.
Ensuring bills are paid on time is also key and can take a bit of planning to know what is coming out of your account and when, to ensure you have sufficient funds to cover payments.
While it can be tempting to rely on an overdraft facility, Mr Johnson says you should try to avoid going over your limit on this and other credit facilities as it can adversely affect your rating.
The more lines of credit you have, the harder it can be to keep on top of repayments, so the advice is to limit your applications for credit.
In terms of repayments, some people believe that they can make ad hoc 'bulk' repayments to their credit cards every few months rather than meeting the agreed or minimum repayment amount on a monthly basis.
This is a very expensive form of credit and anyone that has amassed a large balance on their credit card should consider a personal loan with an affordable repayment schedule to clear it off the credit card balance.
Cutting up the credit card at this point might also be wise. If you wish to review your rating, a copy of your credit report can be requested from the Irish Credit Bureau and/or from the new Central Credit Register.
Question: I'm trying to convince my 33-year-old son to take out health insurance cover to avoid the age loadings. Is this really a good idea and what do you recommend?
Answer: Age loadings only kick in when you turn 35, so you still have a more time to consider your options. Dermot Goode of TotalHealthCover.ie recommends that you take out a basic plan, at the least.
This should cover all public hospitals including the €80-a-night charge which could cost him up to €800 in any one year.
Check out the following plans: VHI One Plan Starter at €504, Laya Assure Protect at €482 or the Irish Life Health Select Starter at €504.
Ideally, you should have cover for private hospitals such as the Beacon Hospital, Hermitage Clinic, Whitfield Clinic etc.
If you can stretch your budget, then check out the Irish Life Health Benefit Plan at €899, Laya Essential Health 300 at €895 or VHI One Plan 250 at €832.
Question: We are booking a family skiing holiday. I know we have some travel cover on our health insurance policy. Do I need to take out separate cover for this?
Answer: Absolutely, and make sure that the policy specifically covers ski trips.
With most health insurance policies, there is minimum cover for 'emergency medical treatment while abroad' but this was never meant to be a substitute for full travel cover.
When travelling, bring your health insurance details, travel insurance policy and also the European Health Insurance Card (EHIC) which covers you for public treatment throughout Europe, according to Dermot Goode of TotalHealthCover.ie.
Ideally, you should be contacting your health insurer and travel insurer in advance of your trip to check that you're fully covered in the event of any accident or illness and also check exactly what you should do in the event of a claim.
Check out the likes of VHI Multi-Trip (must have a health insurance policy to buy this cover) or Blue Insurances for your ski-cover.
The more lines of credit you have, the harder it can be to keep on top of repayments, so the advice is to limit your applications for credit
You should contact your health insurer and travel insurer in advance of your skiing trip to check that you're fully covered in the event of an accident