Keep your credit report in good order

If ever there was a time to get your budget organised, it’s now.

Australia’s credit reporting system has made some major changes and whilst many people would say it’s about time, how much do you know about your personal credit rating?

In the past, Australia used a negative data-reporting system. This meant that your credit report only included a narrow range of negative information – such as bankruptcies, defaults and any instances where you’ve been denied credit. They also included information about habitual ‘late payers’ of utility and other accounts.

In March of this year, legislative reforms brought Australia into line with other Western countries where positive credit scores are the norm.

Credit agencies will now consider new variables such as your payment history and they will also recognize and reward good credit behaviour. (You won’t get prizes, but you will have a record to show if you pay on time)

Currently there are three credit reporting agencies in Australia – Experian, Veda and Dun & Bradstreet.

As an individual, you have the right to request a free copy of your personal credit report every year by contacting any of these national credit reporting agencies. You can do it online and you’ll find their websites easily.

Once you submit the paperwork, credit reports are required to be provided within 10 days of the receipt of your request. If you want your report immediately, you may find that there is a charge involved.

Lots of people tell me that they couldn’t be bothered getting a copy of their personal report but there are good reasons for doing so.

Nowadays when online and personal fraud seems to be more prevalent, obtaining your credit report will help to prevent identity theft; you really can’t afford to be too blasé about this.

Your credit report will also confirm the accuracy of your credit history. Have you ever wondered if there’s a ‘black mark’ against your name? And if there is – did you ever wonder how it got there?

Under this new system, if you miss a loan payment by more than five days, your credit file will be given a black mark and your credit rating will deteriorate. However, it will also show how often you have made repayments on time.

Some of the things that your new credit report will show are:

  • Whether repayments have been made on time over a two-year period
  • If a repayment of over $150 is more than 60 days late, it will be listed as a default
  • The limit on the credit cards for which you have applied
  • The type of card for which you have applied
  • The date you opened a credit account, the type of account, and when it was closed
  • If, because of a default, you have entered into a new arrangement for repayments

What can you do to keep your report in good order?

  • Make sure that you pay a debt/loan on time. More than five days late and you’ll get a black mark.
  • Do your research for credit cards and store cards at a time when you don’t need them. It’s when you’re under pressure to pay for something quickly, that you get the worst deal.
  • If you’re having trouble covering your debt obligations, contact the lender to renegotiate your repayment terms.

Now, you might be thinking that you don’t need to worry about a credit report, but the very next time you apply for, or change a mortgage, a credit card or even a contract for your phone – you can be sure that a credit provider will be looking at your borrowing history.

Of course, sorting out your budget will assist in making sure you are never late in paying a bill, or defaulting on a loan; thus ensuring your credit report stays in good order.



©  Carmel McCartin – Budget Bitch 

And don’t forget – (The views expressed in this blog are the personal opinions of the author. Don’t rely on them to make financial decisions; you have to make up your own mind. If you don’t like the content – then either stop reading or send me an email)


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