WEBVTT - How your credit score makes a difference when applying for loans 0:00:02.869 --> 0:00:05.170 You're listening to AC N A podcast. 0:00:07.300 --> 0:00:09.799 Hey, there, this is Andrea and you're listening to the 0:00:09.810 --> 0:00:13.840 Money Talks podcast. Now, before we dive into today's episode, 0:00:13.930 --> 0:00:16.819 it's a good time for us to address some feedback 0:00:16.829 --> 0:00:21.549 that we've gotten from you on the legacy planning episode. Now, 0:00:21.559 --> 0:00:24.500 before I do that, we just want to say thank 0:00:24.510 --> 0:00:28.329 you for listening to Money Talks because without you subscribing 0:00:28.340 --> 0:00:31.840 and listening to us, we won't have this interaction and 0:00:31.850 --> 0:00:35.240 this means a lot to us. So thank you once again. 0:00:35.819 --> 0:00:39.040 All right. So first point that I wanted to bring 0:00:39.049 --> 0:00:43.699 up and clarify is on how assets are distributed. When 0:00:43.709 --> 0:00:47.569 a minor beneficiary is involved. Let's make it easier with 0:00:47.580 --> 0:00:50.689 a sample scenario. Shall we? Let's imagine we have a 0:00:50.700 --> 0:00:54.200 minor and his name is Ryan. So Ryan's parents have 0:00:54.209 --> 0:00:57.720 passed away and they've left behind a will. Now, the 0:00:57.729 --> 0:01:02.319 will states that Ryan is to inherit everything when he's 0:01:02.330 --> 0:01:03.279 of age. 0:01:03.750 --> 0:01:07.449 Now, the will also mentions three people, a guardian, an 0:01:07.459 --> 0:01:11.839 executor and a trustee. So this is what each of 0:01:11.849 --> 0:01:15.379 them do. Let's start with the guardian. So the guardian 0:01:15.389 --> 0:01:19.580 is someone Ryan's parents have appointed to be responsible for 0:01:19.589 --> 0:01:24.089 him until he comes of legal age. The executor, the 0:01:24.099 --> 0:01:29.769 second person mentioned, manages and distributes the assets as per 0:01:29.779 --> 0:01:30.370 the will. 0:01:30.870 --> 0:01:34.000 The third person is the trustee and that person is 0:01:34.010 --> 0:01:38.610 given the duty of overseeing the assets until Ryan is 0:01:38.620 --> 0:01:42.569 entitled to inherit them. So we went a step further. 0:01:42.580 --> 0:01:46.649 We spoke with Javen Sim, he's from populist law Corporation 0:01:46.980 --> 0:01:50.489 and he says it's possible and actually quite common for 0:01:50.500 --> 0:01:54.580 the same person to wear all three hats, meaning the 0:01:54.589 --> 0:01:58.930 same person can be the guardian, the executor and the trustee. 0:01:59.309 --> 0:02:03.139 But it can also be customized to have two or 0:02:03.150 --> 0:02:06.500 three different people playing these different roles. So it really 0:02:06.510 --> 0:02:10.259 all depends on how Ryan's parents would have wanted it 0:02:10.270 --> 0:02:13.619 or had wanted it in their will. All of this 0:02:13.630 --> 0:02:18.579 is completely separate from how CPF monies are distributed. 0:02:19.059 --> 0:02:22.660 So CPF is obviously a different vehicle altogether, right? If 0:02:22.669 --> 0:02:26.440 no CPF nomination has been made, this is why it's 0:02:26.449 --> 0:02:30.119 important to make your CPF nomination. By the way, what 0:02:30.130 --> 0:02:32.138 happens to the CPF money as well. It's going to 0:02:32.149 --> 0:02:36.559 be handled by the public trustee who will then distribute 0:02:36.570 --> 0:02:42.029 the money according to the intestacy laws or for Muslims 0:02:42.038 --> 0:02:44.679 inheritance certificate in Singapore. 0:02:45.160 --> 0:02:48.600 Ok. So we also got another comment and this one 0:02:48.610 --> 0:02:51.500 was on the grunt of probate. 0:02:52.008 --> 0:02:55.728 So when a person dies and leaves behind a will, 0:02:55.820 --> 0:02:59.869 the executor that's named in the will, must apply for 0:02:59.880 --> 0:03:04.139 a grant of probate to start distributing the assets. Now, 0:03:04.149 --> 0:03:07.910 the time taken to obtain the grant varies. It may 0:03:07.919 --> 0:03:11.699 be as quick as fewer than three months or it 0:03:11.710 --> 0:03:15.199 can be up to a year or more. It really 0:03:15.210 --> 0:03:16.820 all depends on how complex 0:03:17.190 --> 0:03:21.169 the estate is. There could also be issues like family 0:03:21.179 --> 0:03:26.250 members disputing the grant or issues in uncovering the assets 0:03:26.389 --> 0:03:30.029 or issues with the will itself. It really is on 0:03:30.038 --> 0:03:33.089 a case by case basis. So we hope that that 0:03:33.100 --> 0:03:36.699 clarifies this point on the grant of probate. I want 0:03:36.710 --> 0:03:40.690 to thank Peggy Yee from Py Legal LLC for talking 0:03:40.699 --> 0:03:41.690 to us as well. 0:03:42.029 --> 0:03:46.240 And if you have any more messages for us, feel free. 0:03:46.250 --> 0:03:49.759 We love this exchange and this interaction with you. But 0:03:49.770 --> 0:03:52.839 in the meantime, I want to bring you the next episode. So, 0:03:52.850 --> 0:03:55.660 you know, growing up in Singapore, you always have a 0:03:55.669 --> 0:03:59.550 kind of score to achieve, right? It starts with the 0:03:59.559 --> 0:04:04.169 PSLE and then it ends with right now a grading 0:04:04.179 --> 0:04:09.119 at the workplace during your appraisal and that determines how 0:04:09.130 --> 0:04:09.880 well you 0:04:09.985 --> 0:04:13.285 or not so well you performed in your job right? 0:04:13.296 --> 0:04:17.126 Here's another kind of score. You might not have known 0:04:17.135 --> 0:04:21.924 about your financial score. Now, it's called a credit report 0:04:22.015 --> 0:04:25.726 and it gives a sort of health rating on your finances, 0:04:25.895 --> 0:04:30.295 but I bet most of you have no idea what 0:04:30.305 --> 0:04:34.455 your score is, much less used it or referred to it. 0:04:34.635 --> 0:04:37.705 So it is important though in some aspects, 0:04:37.951 --> 0:04:40.671 credit report. So here in the studio to tell us 0:04:40.682 --> 0:04:44.641 why is Wong Sok Kwan, head of Consumer Services at 0:04:44.652 --> 0:04:48.082 Credit Bureau, Singapore. So Kwan, thank you very much for 0:04:48.092 --> 0:04:50.891 joining me. Thank you, Andrea. Ok. So I want to 0:04:50.902 --> 0:04:53.342 start the conversation by putting you on a spot a 0:04:53.351 --> 0:04:55.481 little bit. Ok, I think I know the answer. But 0:04:55.492 --> 0:04:57.571 is your own credit score healthy? 0:04:57.582 --> 0:04:58.332 Definitely 0:04:59.182 --> 0:05:01.861 because as someone who works at the credit Bureau, I 0:05:01.872 --> 0:05:04.332 imagine that's something you have to keep your tabs on. Ok. 0:05:04.342 --> 0:05:05.842 So I'm curious though, 0:05:06.049 --> 0:05:08.859 with the exception of people like you and me, we 0:05:08.869 --> 0:05:12.640 are familiar with what's happening in the financial world and 0:05:12.649 --> 0:05:16.709 our financial health, most people actually don't really know that 0:05:16.720 --> 0:05:19.959 they can get a credit report. Is this your experience 0:05:19.970 --> 0:05:20.089 as 0:05:20.100 --> 0:05:20.399 well? 0:05:20.410 --> 0:05:21.829 Yeah, not everyone know about this. 0:05:22.200 --> 0:05:23.950 So what do you tell them? 0:05:23.959 --> 0:05:24.260 Yeah, 0:05:24.613 --> 0:05:27.015 we will ask them to visit our website at WW 0:05:27.024 --> 0:05:29.904 dot Credit bureau.com dot SG to obtain a copy of 0:05:29.915 --> 0:05:32.345 their report. So even if they do not want a 0:05:32.355 --> 0:05:35.015 copy of report, we also have sample report attached in 0:05:35.024 --> 0:05:37.035 the website so that you can take a look of 0:05:37.045 --> 0:05:38.165 the interpretation. 0:05:38.214 --> 0:05:40.214 So it doesn't, it doesn't have to be if you're 0:05:40.225 --> 0:05:42.565 too afraid for example, to look at your report, 0:05:42.859 --> 0:05:44.679 you can look at the sample one. Ok. So you 0:05:44.690 --> 0:05:48.010 can pay $8 I believe and then get a report. 0:05:48.149 --> 0:05:51.488 I've seen my credit report and I'm still confused. Walk 0:05:51.500 --> 0:05:52.839 me through the grading system, 0:05:52.850 --> 0:05:56.100 there is a numeric score and also there is a 0:05:56.109 --> 0:06:00.089 alphabetical score. It will be from a A to hh 0:06:00.140 --> 0:06:02.239 so a A will be of course the best score, 0:06:02.250 --> 0:06:04.599 of course. Yeah hh will be the higher chance of 0:06:04.609 --> 0:06:07.500 a person will be falling into delinquency. The score will 0:06:07.510 --> 0:06:10.519 be ranging from 1000 to 2000 with 2000 being the 0:06:10.529 --> 0:06:11.928 best score which is the highest credit 0:06:12.019 --> 0:06:16.079 worthiness and also for 1000 being the lowest credit worthiness. Ok, 0:06:16.088 --> 0:06:18.019 so of course it will be good to have a 0:06:18.028 --> 0:06:19.308 a score. Ok, 0:06:19.319 --> 0:06:22.419 a a so that is accompanied by the numerical score. 0:06:22.428 --> 0:06:26.239 Is that correct? Yes. Ah ok. What is this score 0:06:26.248 --> 0:06:27.837 based on the 0:06:27.848 --> 0:06:31.628 score is based on the information in the credit report 0:06:31.639 --> 0:06:34.039 such as the monthly installment you will see that the 0:06:34.049 --> 0:06:37.568 12 cycle in your credit report, whether you pay full 0:06:37.579 --> 0:06:39.709 payment or not in every month it is a 12 0:06:39.738 --> 0:06:40.998 month it's a 12 month cyc 0:06:41.558 --> 0:06:43.747 so whether is it a full payment? Whether is there 0:06:43.757 --> 0:06:45.238 any missing cycle you did not 0:06:45.247 --> 0:06:45.638 pay? 0:06:45.648 --> 0:06:47.377 Ok, so if you don't pay it is going to 0:06:47.388 --> 0:06:48.798 raise a red flag and it's gonna 0:06:50.048 --> 0:06:51.118 adjust the score a little 0:06:51.127 --> 0:06:51.417 bit. 0:06:51.428 --> 0:06:54.847 Ah ok so this is why you have to pay 0:06:54.858 --> 0:06:58.756 your bills. Our credit reports just tells us how well 0:06:58.767 --> 0:07:03.087 or how badly we are scoring. What essentially are credit 0:07:03.097 --> 0:07:05.967 reports used for? I mean who has access to them 0:07:05.976 --> 0:07:06.917 besides us 0:07:06.928 --> 0:07:10.238 consent for example, if your company is 0:07:10.337 --> 0:07:12.557 doing a credit check on you, you will definitely have 0:07:12.566 --> 0:07:15.606 to sign a consent form before CBS can review the 0:07:15.617 --> 0:07:16.217 report to 0:07:16.226 --> 0:07:16.516 them. 0:07:16.527 --> 0:07:20.407 Ok. So how often does this happen where companies request 0:07:20.416 --> 0:07:22.277 for an individual's credit report? 0:07:22.286 --> 0:07:25.187 Yeah, I think it varies for different organizations. I mean, 0:07:25.247 --> 0:07:28.286 some will do annual checks, some will do quite frequent check. 0:07:28.296 --> 0:07:30.236 It depends on the res appetite, 0:07:30.247 --> 0:07:33.516 right? So this is both for existing employees, 0:07:33.527 --> 0:07:36.777 existing employees and those new onboarding candidates, 0:07:36.786 --> 0:07:37.316 right? 0:07:37.326 --> 0:07:39.407 Ok. When a company does a credit 0:07:39.496 --> 0:07:42.465 check on an individual, be it an existing employee or 0:07:42.476 --> 0:07:45.776 a new employee, is there a limit that they cannot breach? 0:07:45.786 --> 0:07:49.985 For example, someone who scores above an age? But you're 0:07:49.996 --> 0:07:53.196 not an A a either perhaps like ad or an 0:07:53.205 --> 0:07:56.715 F is that something that raises red flags for companies? 0:07:56.726 --> 0:08:00.835 Different banks of different organizations have different risk appetite. So 0:08:00.846 --> 0:08:02.545 it depends on what they are looking 0:08:02.555 --> 0:08:02.846 at. 0:08:03.135 --> 0:08:05.536 Ok. What do they pay attention to normally 0:08:05.545 --> 0:08:08.385 usually is account status history, any aggregated 0:08:08.654 --> 0:08:13.274 outstanding balances and the amount of credit facility that you have. 0:08:13.304 --> 0:08:16.135 Of course, the more credit facility you have there is 0:08:16.144 --> 0:08:19.125 a chance for you to miss payment or forget your payment, 0:08:19.174 --> 0:08:22.755 which would eventually affect your credit behavior. 0:08:22.765 --> 0:08:27.375 Ok. Aside from companies, banks are also able to access 0:08:27.385 --> 0:08:30.295 our credit reports. Is that correct? They still need your 0:08:30.304 --> 0:08:31.195 permission to do that. 0:08:31.295 --> 0:08:31.695 Just 0:08:31.704 --> 0:08:33.275 like when you apply for a credit card, you do 0:08:33.284 --> 0:08:36.414 sign authorization for them to pull your credit report. So 0:08:36.424 --> 0:08:37.715 without any authorization, 0:08:37.814 --> 0:08:38.783 the bank is unable to do 0:08:38.794 --> 0:08:39.213 so. 0:08:39.283 --> 0:08:42.583 Ok. So I've seen my credit report before as I 0:08:42.593 --> 0:08:45.364 mentioned earlier and it's a really technical sheet, right? A 0:08:45.374 --> 0:08:47.984 piece of paper with a lot of courses, a lot 0:08:47.994 --> 0:08:51.013 of digits. So let's talk about how to read a 0:08:51.023 --> 0:08:56.083 credit report. First and foremost, what's the most important data 0:08:56.093 --> 0:08:57.794 point to zoom in on? 0:08:57.903 --> 0:08:59.943 Yeah, so I have a credit report here with me 0:08:59.953 --> 0:09:00.414 right now. 0:09:00.653 --> 0:09:02.783 Ok, a sample, right? So of 0:09:02.794 --> 0:09:03.523 course it's a 0:09:03.854 --> 0:09:04.754 lot of words. Yeah, 0:09:04.763 --> 0:09:06.854 so the first page is just your person 0:09:07.083 --> 0:09:11.311 data personal details. We will focus more on this account 0:09:11.322 --> 0:09:13.732 status history, right? So for the first year, we will 0:09:13.742 --> 0:09:16.432 show the type of credit facility you have such as 0:09:16.442 --> 0:09:20.272 bank loans, credit cards, and unsecured credit. So any mortgages 0:09:20.283 --> 0:09:21.913 loan will also appear in this 0:09:21.922 --> 0:09:22.333 section. 0:09:22.343 --> 0:09:25.333 Yeah, I see H DB loan there as well. Yes. 0:09:25.343 --> 0:09:28.913 So obviously each month that you pay your loans, your 0:09:28.922 --> 0:09:31.463 credit cards, that number is going to change every month, right? 0:09:31.473 --> 0:09:33.903 So what else am I seeing on this credit 0:09:33.913 --> 0:09:34.353 report? 0:09:34.362 --> 0:09:36.043 Yeah, you will see that there is this section 0:09:36.142 --> 0:09:39.591 under previous inquiry, you will see that. Ok. The bank 0:09:39.601 --> 0:09:42.851 is reviewing on you on your existing credit facility or 0:09:42.861 --> 0:09:46.322 if there is any new application. So for this new application, 0:09:46.331 --> 0:09:49.080 we have to take note that we should refrain from 0:09:49.252 --> 0:09:52.471 apply too many new credit facility at a short period 0:09:52.481 --> 0:09:52.981 of time? 0:09:52.992 --> 0:09:55.142 Ok. What do you mean by short? How short 0:09:55.151 --> 0:09:57.651 is short, how short it depends on the risk appetite 0:09:57.660 --> 0:10:01.231 from the bank. So if a person applying, for example, 0:10:01.242 --> 0:10:04.432 can credit facility within one month. So it shows that 0:10:04.442 --> 0:10:05.062 this person 0:10:05.351 --> 0:10:08.510 by a lot of credit within a short period of time, right? Yes. 0:10:08.520 --> 0:10:11.120 So it will more or less affect the credit score 0:10:11.130 --> 0:10:14.070 if you have too many new application in this section. 0:10:14.080 --> 0:10:18.160 Ok, so don't apply for too many credit facilities in 0:10:18.171 --> 0:10:20.611 a short period of time. Ok. What else do you 0:10:20.620 --> 0:10:23.709 think is the most important data point here in the 0:10:23.721 --> 0:10:24.080 credit 0:10:24.091 --> 0:10:24.640 report? 0:10:24.651 --> 0:10:28.300 Yeah, actually all the parts plays a little role in 0:10:28.309 --> 0:10:31.500 achieving the credit score. So there is also a section 0:10:31.510 --> 0:10:34.320 showing aggregated outstanding balance and your monthly install. 0:10:35.080 --> 0:10:39.289 Ok. Yes. So these are the aggregated outstanding balance which 0:10:39.299 --> 0:10:42.429 the lenders can tell. Ok, what is the current total 0:10:42.440 --> 0:10:45.049 outstanding that you have with all the banks and fis? 0:10:45.059 --> 0:10:45.640 Why 0:10:45.650 --> 0:10:48.950 is this important to the people who are viewing this report? 0:10:48.960 --> 0:10:51.309 Is it meant to show that I am paying my 0:10:51.320 --> 0:10:52.380 bills regularly? 0:10:52.440 --> 0:10:55.299 Yeah, so to assess the person credit worthiness, whether did 0:10:55.309 --> 0:10:57.530 they pay on time all the time and whether can 0:10:57.539 --> 0:10:59.669 they afford within their credit limits? 0:10:59.679 --> 0:11:02.559 And obviously we know that paying our bills in full 0:11:02.570 --> 0:11:03.510 is a big benefit 0:11:03.609 --> 0:11:06.499 to us if we don't pay in full and we 0:11:06.508 --> 0:11:11.669 roll that credit. But we are regular payers. That's also ok. Right. 0:11:11.679 --> 0:11:13.549 Yeah, that will be ok but 0:11:13.559 --> 0:11:14.669 not advisable, not 0:11:14.679 --> 0:11:17.658 advisable because this will also be reflected in the account 0:11:17.669 --> 0:11:21.108 status history, full payment or not. So if there is, 0:11:21.119 --> 0:11:23.518 and throughout it means that this person has not been 0:11:23.528 --> 0:11:25.429 paying full every time, right? 0:11:25.818 --> 0:11:28.388 Ok. And that's a pretty big warning as well, right? 0:11:28.398 --> 0:11:32.669 For whoever's reviewing the credit. Ok. So if we have 0:11:32.768 --> 0:11:37.168 have a less than sparkly credit report, right, you will 0:11:37.177 --> 0:11:40.228 find that we are unable to apply for a new loan, 0:11:40.237 --> 0:11:43.687 for example, because our credit reports not looking very good. 0:11:43.708 --> 0:11:47.867 How would you recommend we use our credit report to 0:11:47.877 --> 0:11:50.436 review our own financial habits? 0:11:50.447 --> 0:11:50.668 Of 0:11:50.677 --> 0:11:52.687 course, if we are in debt, we need to try 0:11:52.697 --> 0:11:55.897 to prioritize which are the credit facility that we need 0:11:55.908 --> 0:11:58.987 to pay off first. For example, if credit card is 0:11:58.997 --> 0:12:01.708 the one that imposes more interest rate, we should pay 0:12:01.927 --> 0:12:04.497 the credit card first so that the interest will not 0:12:04.506 --> 0:12:07.546 be rolled over to become snowball amount, which we are 0:12:07.557 --> 0:12:10.117 unable to pay. If the amount becomes snowball and we 0:12:10.127 --> 0:12:12.586 are unable to pay. And the bank loaded a default, 0:12:12.596 --> 0:12:15.956 then it will be reflected in this default section. Ah, 0:12:15.966 --> 0:12:18.656 and the default is a bankruptcy as well or is 0:12:18.666 --> 0:12:18.767 that 0:12:18.776 --> 0:12:21.317 different? Is different? It's just that they are unable to 0:12:21.327 --> 0:12:25.036 pay off the credit facility and they will negotiate with 0:12:25.046 --> 0:12:27.387 the bank to come up with a settlement amount. 0:12:27.636 --> 0:12:28.136 Ok. 0:12:28.317 --> 0:12:30.827 The other thing that I discovered is that 0:12:31.085 --> 0:12:34.106 the fact that I have no credit and that can 0:12:34.116 --> 0:12:37.944 actually be a bad thing. So when you don't have 0:12:37.955 --> 0:12:41.755 enough of credit activity and the credit report gives you 0:12:41.765 --> 0:12:45.064 a grade, is that grade an A a or an hh, 0:12:45.075 --> 0:12:47.486 so it wouldn't be fall into this a A to 0:12:47.495 --> 0:12:50.135 hh range. So it will be classified as a non 0:12:50.216 --> 0:12:53.616 score risk grade which the consumer will be awarded with 0:12:53.625 --> 0:12:57.175 AC X score AC X. Ok. So it defines that 0:12:57.184 --> 0:13:00.145 it has an insufficient credit history to enable 0:13:00.244 --> 0:13:03.744 the credit score to compute a score for this individual. 0:13:04.184 --> 0:13:08.784 Ok. So is this CX grade good or bad? 0:13:08.794 --> 0:13:09.044 It 0:13:09.054 --> 0:13:12.265 depends on the lenders, what they are looking at it 0:13:12.275 --> 0:13:15.224 basically tell the lenders that this person does not have 0:13:15.234 --> 0:13:18.164 a credit profile at all. Yeah, probably a fresh 0:13:18.174 --> 0:13:18.574 grad. 0:13:18.585 --> 0:13:21.505 Ah I see or someone like me who took long 0:13:21.515 --> 0:13:23.834 to pay off a debt and then just didn't have 0:13:23.844 --> 0:13:25.164 any more credit cards after that. 0:13:25.174 --> 0:13:29.103 Right? Bear in mind that if you just rebuild your credit, 0:13:29.114 --> 0:13:29.294 that's 0:13:29.403 --> 0:13:31.863 fast track to it because it takes time to rebuild 0:13:31.874 --> 0:13:34.273 your credit in the credit report. It shows the past 0:13:34.283 --> 0:13:36.184 12 cycle at a point of time when you retrieve 0:13:36.193 --> 0:13:39.054 a report. So we have to slowly build up the 0:13:39.064 --> 0:13:42.443 credit score and it depends on individual because the credit 0:13:42.453 --> 0:13:45.314 score will look into all parts of the reports, not 0:13:45.323 --> 0:13:48.093 just only on the account status history. It will look 0:13:48.104 --> 0:13:49.382 in the profile as a whole. 0:13:49.393 --> 0:13:52.783 The credit report shows a 12 month cycle. Correct. How 0:13:52.794 --> 0:13:56.343 often does the grade change see if certain time a 0:13:56.354 --> 0:13:58.283 certain duration of time has 0:13:58.692 --> 0:13:59.463 and you've not paid? 0:13:59.473 --> 0:14:02.372 Ok. The score will be only generated if you put 0:14:02.381 --> 0:14:04.403 out your own report at a point of time. When 0:14:04.413 --> 0:14:06.023 you did not put out your report, the bank will 0:14:06.033 --> 0:14:08.893 continue to load the payment cycle and there wouldn't be 0:14:08.903 --> 0:14:09.622 any score, 0:14:09.631 --> 0:14:12.703 right? So if I buy my report in January, it 0:14:12.713 --> 0:14:16.043 gives me that score for that period. It just reflects 0:14:16.052 --> 0:14:19.422 the live score and then later on if and then 0:14:19.432 --> 0:14:21.622 I don't pay by my bills for about two months. 0:14:21.632 --> 0:14:25.062 So by the time April comes around and I download 0:14:25.072 --> 0:14:27.622 my April credit report, then it will 0:14:27.721 --> 0:14:28.611 show a different 0:14:28.622 --> 0:14:29.021 score. 0:14:29.031 --> 0:14:32.661 It may or it may not depends on your credit behavior. 0:14:32.671 --> 0:14:35.291 For example, during that period, did you apply any new 0:14:35.302 --> 0:14:38.311 credit facility applying too many credit facility during a short 0:14:38.322 --> 0:14:40.340 period of time will also impact on the score? 0:14:40.351 --> 0:14:40.502 I 0:14:40.512 --> 0:14:43.541 understand that it takes some years for your sort of 0:14:43.552 --> 0:14:46.421 record to be clean again after you've paid off your debts. 0:14:46.432 --> 0:14:49.171 And you did say rightfully that the Credit Bureau looks 0:14:49.182 --> 0:14:51.971 at how you grow that credit again, right? Which is 0:14:51.981 --> 0:14:54.521 an indicator of financial health. Why does it take so 0:14:54.531 --> 0:14:54.981 long? 0:14:54.992 --> 0:14:56.781 Different consumer have different 0:14:56.880 --> 0:15:00.120 issues of repaying that debt. Probably some miss a few cycles. 0:15:00.130 --> 0:15:02.640 So they take shorter time to rebuild. But for example, 0:15:02.651 --> 0:15:04.901 for some, they have been missing for the past 12 0:15:04.911 --> 0:15:07.620 cycle and did not make payment in full, which explain 0:15:07.630 --> 0:15:09.731 why they need longer time to build up their credit 0:15:09.741 --> 0:15:10.260 profile. 0:15:10.270 --> 0:15:13.041 So maybe answer this question that I have then why 0:15:13.051 --> 0:15:15.901 is it important for us to have some kind of 0:15:15.911 --> 0:15:17.820 credit on our name? Yes. 0:15:17.830 --> 0:15:20.080 So that we can see whether is this person a 0:15:20.091 --> 0:15:22.601 good payment master or not, whether can they pay on 0:15:22.611 --> 0:15:25.361 time every time? And also how good are they in 0:15:25.370 --> 0:15:25.911 managing their 0:15:26.039 --> 0:15:26.950 finances? 0:15:27.030 --> 0:15:31.510 Ok. So how often should we be checking our credit health? 0:15:31.520 --> 0:15:34.929 How often should we be paying this $8 and downloading 0:15:34.940 --> 0:15:36.179 this credit report? 0:15:36.190 --> 0:15:38.590 I feel that you yourself would know that whether you 0:15:38.599 --> 0:15:41.409 have been paying or not. So if you have been paying, 0:15:41.419 --> 0:15:44.080 then your score would definitely be improving. 0:15:44.179 --> 0:15:46.989 Um ok. How often do you check your credit 0:15:47.000 --> 0:15:47.380 report? 0:15:47.390 --> 0:15:49.450 To be honest, I don't do checks on my own 0:15:49.460 --> 0:15:49.739 credit 0:15:49.750 --> 0:15:50.340 report. 0:15:50.349 --> 0:15:53.460 Yeah, because you are very confident of paying your bills 0:15:53.469 --> 0:15:54.859 on time. Yeah. Ok, 0:15:55.198 --> 0:15:59.198 exactly. Is a good time for us to download our 0:15:59.208 --> 0:16:03.609 credit report? I imagine when you're about to spend the 0:16:03.619 --> 0:16:06.578 big bucks right on a house or a car, for example. 0:16:06.588 --> 0:16:07.898 Would that be an example? 0:16:07.908 --> 0:16:10.629 Yes, of course. We will not get the credit report 0:16:10.638 --> 0:16:13.559 until the time that we need it as mentioned earlier on. 0:16:13.568 --> 0:16:16.679 We can actually download the report any time so that 0:16:16.689 --> 0:16:19.119 you can understand your credit health and see how can 0:16:19.129 --> 0:16:20.979 you improve on your credit score. 0:16:21.268 --> 0:16:24.249 And that's before. Yes, you have or when you have 0:16:24.357 --> 0:16:29.348 intention of buying a flat or a house or a car, right? So, 0:16:29.357 --> 0:16:33.038 so Kwan, do you have any final notes about what 0:16:33.047 --> 0:16:35.247 is it about a credit report that we need to know? 0:16:35.288 --> 0:16:38.598 It is important to maintain a good credit score so 0:16:38.607 --> 0:16:41.458 that it won't affect your employment. It won't affect your 0:16:41.468 --> 0:16:42.697 credit application. 0:16:42.708 --> 0:16:43.377 Ok. 0:16:43.408 --> 0:16:47.218 On this podcast, we've been advised by numerous guests, the 0:16:47.228 --> 0:16:52.367 importance of paying your bills, especially high interest credits to 0:16:52.377 --> 0:16:53.437 summarize good credit 0:16:53.517 --> 0:16:56.486 health. Just like our physical health. It is a reflection 0:16:56.497 --> 0:17:00.307 of how well we are in control of our finances. 0:17:00.546 --> 0:17:04.616 It's also a positive signal to creditors and companies that 0:17:04.626 --> 0:17:09.016 you are a reliable trustworthy borrower who always honors your 0:17:09.026 --> 0:17:12.015 debts and that has ripple effects when it comes to 0:17:12.026 --> 0:17:15.136 your jobs and access to loans in the future as well. 0:17:15.146 --> 0:17:18.866 Who doesn't want a clean sheet? Having a good credit 0:17:18.876 --> 0:17:22.567 record actually helps you more than hinders you. 0:17:24.670 --> 0:17:28.119 So, Kwan, we have a segment called Questions from a hat. 0:17:28.219 --> 0:17:30.770 So there are mystery questions in here. None of them difficult. 0:17:30.780 --> 0:17:33.270 Don't worry. This is the fun part of the podcast. 0:17:33.420 --> 0:17:36.699 You'll have to pick a question from this hat. So 0:17:36.709 --> 0:17:38.800 just pick one hand it to me and then I 0:17:38.810 --> 0:17:40.530 will ask you the question. 0:17:43.040 --> 0:17:48.099 All right. So Kwan, what financial advice would you give 0:17:48.109 --> 0:17:50.109 to your 20 year old self? 0:17:50.119 --> 0:17:54.040 20 year old self? Ok. I think if, when I'm 0:17:54.050 --> 0:17:57.630 20 years old probably I can apply a credit card. Yeah. 0:17:57.640 --> 0:18:00.619 So at that point of time I would tell myself 0:18:00.630 --> 0:18:04.669 to spend wisely and spend within our own means so 0:18:04.680 --> 0:18:07.030 that my credit score will be good. But of course, 0:18:07.040 --> 0:18:08.729 at that point of time, I wouldn't 0:18:09.310 --> 0:18:11.010 take a copy of my credit report yet. 0:18:11.020 --> 0:18:11.379 Neither 0:18:11.390 --> 0:18:13.438 did I and I probably don't think a lot of 0:18:13.449 --> 0:18:15.079 20 years out there would do the same. So Kwan, 0:18:15.109 --> 0:18:17.319 it's been a pleasure. Thank you so much for coming 0:18:17.329 --> 0:18:20.619 on the podcast today. Thank you. And hey, listen up, 0:18:20.630 --> 0:18:23.349 we hope there was something in this conversation that was 0:18:23.359 --> 0:18:26.329 useful that taught you something about checking in on your 0:18:26.339 --> 0:18:29.889 financial health. It doesn't hurt to go into triple W 0:18:29.900 --> 0:18:33.948 dot Credit bureau.com dot SG. That's where you can download 0:18:33.959 --> 0:18:37.260