Useful Information on Credit Repair
Who are the Australian Credit Reporting Agencies?
There are (3) main Credit Reporting Agencies in Australia. The largest and most used by lending institutions and creditors is Veda Advantage , however the others should also be considered.
- Veda Advantage:
- Dunn & Bradstreet:
- Tasmanian Collection Services:
What information is held on a credit file & for How long?
External Administrations - 10 Years
Previous Directorships - 10 Years
Bankruptcy, Part 9 Debt Agreements - 7 Years
Serious Credit Infringement - 7 Years
Credit Enquiry, payment Default - 5 Years
Court Judgment - 5 Years
- Summons, Court Writ - 4 Years
Which government agency may be able to assist if you experience a problem with your credit file?
- The Office of the Australian Information Commissioner www.privacy.gov.au
Make an online express enquiry or call us on (02) 8677 7299.
Author: Mary Trimarchi
The Way Credit Scores Work in Australia
From March 2014 onwards, the Australian system of credit reporting began to include not only the negative information on a person's credit file, but also positive credit information. This has a tremendous impact on how credit scores will be calculated, and the kind of score you're liable to receive.
In Australia, a score of 749 is the average, and a good score could be anywhere between 622 and 1200. This score is influenced by both the positive as well as the negative credit information provided in your credit file. So let's try and understand what each of them constitutes.
Negative Credit Information
Negative credit information involves your personal details, such as your name, address, gender, birthdate, license number, and details of employer. Additionally, it also includes details such as:
- Credit enquiries and applications made in the previous five years
- Current credit account records in terms of gas, electricity, and mobile bills for instance
- Bankruptcies and insolvencies
- Payment defaults and overdue accounts. An example here would be defaulting on a loan which you haven't paid for 60 days
- Court judgements and summons
- Public information records including ownership records etc.
Positive credit information, as the name goes, could positively impact your credit score and chances of securing favourable rates of interest on your credit applications. Positive credit information may involve the following elements:
- Kind of credit account (for instance, whether it's a home loan or a credit card)
- Opening and closing dates of the account
- Details of credit provider
- Usage limit of credit and account balance
- History of repayment
Some other ways to improve your credit score are:
Obtaining a credit card: Owning a credit card and managing it wisely showcases a capacity to handle debt. However, the flipside is that each credit card you apply for negatively impacts your credit score. For this purpose, it's best to increase your credit card limit rather than getting a new one.
Being versatile with credit: Your ability to successfully manage a diverse variety of credit also enhances your credit score. For example, if you take a loan to buy a vehicle, and a mortgage to purchase a house - and pay your debt in time, this shows that you have the ability to deal with different types of credit situations.
Using another's credit: If you're close to someone who has maintained a good credit history, ask them to add you as a credit card holder to their own credit account. By doing so, you will include this person's payment history to your own credit report, thereby bolstering your credit score. If this person has an account for a long period of time, you have stability and longevity working for you as well - without really having done anything!
Keeping unused accounts open: After you've paid your credit card debt, avoid closing your account. There's a lot of benefit in keeping an account open without having any negative reports over a sustained period of time, and this ultimately has a very positive effect over your credit score. On credit cards that you have yet to pay off, it is recommended that you keep a credit limit balance of at least 30% to keep up the good credit score.