Green flags, red flags

Questions you'll answer

Quick facts

• Paying your phone bill on time every month → Green flag. A steady on-time record is the single best signal.
• Missing a credit card payment by two weeks → Red flag. Missed payments can stay on your file for six years. Set up at least the minimum by direct debit.
• Applying for six credit cards in one week → Red flag. Lots of hard searches close together can look desperate to lenders.
• Registering on the electoral roll at your address → Green flag. It helps lenders confirm you live where you say you do.
• Using 95% of your credit card limit every month → Red flag. High utilisation can suggest you're stretched.
• Having a bank account open for years with no drama → Green flag. Long, stable history is a quiet green flag.
• Fact: “Paying in full every month can help your file and costs no interest on most cards.” — Clearing the statement balance shows good management, and usually avoids interest on purchases.
• Myth: “A missed payment disappears after a month.” — Missed and late payments usually stay on your file for six years, though their impact fades over time.
• Myth: “One late payment means no one will ever lend to you.” — It hurts, but files recover. Get back on track and keep going.

More in Credit Scores & Files

• Your invisible report card
• Meet the reference agencies
• Prove you exist
• The utilisation situation
• Hard vs soft searches
• Something's wrong on my file

All 12 Credit Scores & Files lessons

Related topics

• Borrowing
• Credit Cards: Tool, Not Trap
• Banking & Payments