MyCRA Specialist Credit Repair Lawyers

Tag: bad credit history

  • How do I fix my bad credit?

    In this day and age everything works on credit. If you cop a default on your credit file – you will be refused credit with mainstream lenders (at affordable interest rates). If you do get a loan, often the interest rate is much higher. You may also find you can’t get credit cards or mobile phones on a plan. So you can’t afford to let bad credit history stand in your way – especially if that credit listing shouldn’t be there. Let’s look at what you can do if you want to fix bad credit.

    By Graham Doessel, Founder and CEO of MyCRA Credit Rating Repairs and www.fixmybadcredit.com.au.

    If you have bad credit – you have two options….

    1. You can attempt to remove the default or other credit listing yourself, and there are processes to do this – OR

    2. You can use a professional credit repair service.

    The benefit in fixing your own bad credit is that it’s cheap. You may have very little costs associated with disputing your own credit listing. But similarly to defending yourself in Court – the cheap option may not be the best one for you.

    Credit rating errors are quite common, and the onus of ensuring the accuracy of your credit file rests with you. But how do you know if a listing has been placed accurately on your credit file, or if it should be there in the first place?

    There are strict codes of conduct and legislation which must be adhered to when your Credit Provider is placing a default or other credit listing on your credit file. These laws are in place to protect consumers from unfair and damaging credit reporting. Creditors are largely aware of this legislation (yet may not have adhered to it), but there are very few consumers who are well-versed in credit reporting and industry legislation.

    In order to dispute a credit listing which you believe shouldn’t be there, you must identify where the Creditor has not adhered to current legislation when placing the notation on your credit file. There is a whole barrage of points which need to be met in order to constitute a valid listing, and if you have not been made aware of all the avenues for dispute, then you could be doing yourself and your case a disservice.

    A professional credit repairer will often dig deeper to conduct an audit-like investigation of your credit complaint to uncover errors or non-compliance.

    What’s the process for a credit repairer to fix my bad credit?

    Credit repair is not an exact science, because every case is different but there are some common threads which run through credit reporting law which we follow.

    Firstly, we order a free copy of your credit file on your behalf from one or more of Australia’s credit reporting agencies which tells us exactly who and what we are dealing with in relation to the bad credit.

    Then we investigate any avenues for disputing your credit listing or listings with your creditor. This involves requesting documentation from your creditor about your account. The creditor can at times take a while to provide the information they should.

    Then the information we receive is cross-referenced against the appropriate legislation for potential compliance errors.

    Then we formally communicate with your creditor to request the removal of what we would then deem to be a listing placed on your credit file unlawfully. This process can be a bit ‘back –and- forth’, as there are procedures that we, and they have to follow in accordance with industry and the law as well as negotiations which take place behind the scenes with creditors. The complaint may also need to be escalated to a higher authority such as an industry Ombudsman if there is no satisfaction with the creditor.

    If the creditor agrees to remove the listing, we ask you to contact the credit reporting agencies at a later date to confirm it has been removed. (You don’t generate a credit ‘enquiry’ on your credit file if you request the information yourself – and too many credit enquiries could see you refused a loan).

    How long will it take to fix my bad credit?

    The length of time it will take to remove bad credit from your credit file is very much an unknown factor.

    It could depend on the particular facts relating to your application, including the evidence required to support each party’s claims; on the amount of cooperation we receive from your creditor/s including how quickly they respond to our requests; on the number of issues raised in your application; the volume and relevance of information and supporting documents provided by you and the complexity of the legislation relating to your particular defaults.

    At MyCRA Credit Rating Repairs, the costs involved are not based on the amount owing nor the time it takes to remove the listing, but are on a per-listing basis. For more information on costs, visit our main website www.mycra.com.au.

    Warning

    Not all credit repairers are the same.

    What makes a good Credit Rating Repair Company?

    1. Transparency

    You need full disclosure of fees and charges up front. You need to know exactly what the service will cost before you spend a single cent. Are there any Guarantees in place, what about refund policies. Then, is it all written down?

    2. History

    Are there testimonials, and can you verify them? Anyone can write a testimonial, but are they willing to put their name on it and have you call them? If you can’t call the person that’s raving about the Credit Rating Repair Company, how do you know it is a real testimonial and not just made up?

    3. Expectations

    What are your chances of success, what are the refund policies, how long is it going to take? These are all questions that you should be able to answer before you speak to anyone. This information should be published on their website.

    In addition to these 3 items, there are a few others to check on as well.

    -Are they a “One Man Band”?
    – Do they have the resources to do what they say they do?
    – Is it a Registered Company or just a business name? (how to check..)
    – Are they registered with the ATO (Australian Taxation Office) for GST (Making more than $75,000 PA requires registration) (How to check..)

    The main message here is:

    Before you hand over your hard earned cash, make sure you do your homework and know who it is that you are dealing with.

    MyCRA Credit Rating Repairs publishes costs, product information, is fully registered, has the resources and experience, has verifiable testimonials, is registered for GST, and is an established business in Both Australia and New Zealand. You can speak to MyCRA for FREE and if we don’t think we can help, we won’t charge you a thing.

    If you’d like to speak to a real person about how we can help fix your bad credit, contact a Credit Repair Advisor on 1300 667 218.

    Image: David Castillo Dominici/ www.FreeDigitalPhotos.net

     

  • Credit file warning: Organised crime groups focused on stealing your identity

    In the future, the security of your personal information may be more crucial than ever. A warning coming from the Australian Crime Commission that organised crime groups will be more likely to hone in on opportunities associated with identity theft to commit crimes in the future. This could have serious implications for every aspect of your life. Your identity is basically your good name, and financially, it is also the key to your ability to obtain credit through your credit file. If you become an identity theft victim, you may also become a victim of credit fraud and end up in serious debt and with bad credit history for years. We look at what is happening, what is predicted for the future, and the 10 ways you can protect your personal information.

    By Graham Doessel, Founder and CEO of MyCRA Credit Rating Repairs and www.fixmybadcredit.com.au.

    The Australian Crime Commission (ACC) has said at a national conference for credit professionals that identity crime is used by almost all of the serous and organised criminal groups operating in Australia and is a key enabling activity for a range of frauds.

    The ACC’s Chief Executive Officer, John Lawler presented at the Dun and Bradstreet Consumer Credit Conference, ‘Credit risk in Australia – The road ahead’ last week. Mr Lawler spoke on ‘Global trends in consumer fraud’. Mr Lawler said identity crime is a “key facilitator” for organised crime groups because it is an anonymous crime which can enable significant fraud.

    “Every single person in this room and the various sectors and organisations that you represent are targets for organised crime,” he told the Conference.

    “Criminals will exploit technology to not only carry out new crimes but commit traditional crimes on a much larger scale.”

    The ACC estimates organised crime is currently costing the Australian economy at least $15 billion per annum – and that the impacts of this are significant and growing.

    Globally, the cost of cyber-crime alone has been calculated at $388 billion annually. This is more than the global market in marijuana, cocaine and heroin combined ($288 billion).

    Mr Lawler says the amount of personal information requested and stored online, along with the growing popularity of social networking sites, provides organised crime with a larger pool of victims and data to harvest:

    •Phishing attacks have become well designed and targeted.
    •Companies are being increasingly targeted as criminals are attracted to large volumes of data stored in single systems.
    •Organised criminals are also warehousing data for later use, making it more difficult to detect when and how data breaches have occurred.

    He says that the most threatening crime groups are diversified in the nature of their crimes – so they are running several ‘games’ and warned that these groups are increasing their level of involvement in fraud. He says this is due to the big pay offs. It’s anonymous so generates less risk, whilst bringing in “some significant profits.” The range of fraud types can include credit card fraud, mass marketed fraud, revenue and taxation fraud, superannuation fraud and financial market fraud.

    “Organised criminals seek to conduct significant research on their intended victims and tailoring their operations to target weaknesses.

    Serious and organised crime is embracing technology and the cyber environment like never before. The use by organised crime of professional facilitators, the use of false and stolen identities provides them with access to systems and data on an unprecedented scale. One manifestation of this is the unlawful access to and supply of illicit commodities, malware and illegal firearms through online sites such as darknets.

    This interface is occurring at all levels from an individual perpetrator to sophisticated serious and organised criminal networks. The anonymity and obfuscation of identity/location provided by the cyber environment facilitates these criminal acts,” he said.

    He warned of the prevalence of “white-collar” fraud like investment fraud. Which don’t target the naïve, but target those with plenty of money looking to invest prior to retiring. The scams are extremely well thought out:

    “Fraudulent syndicates rely on establishing a perception of legitimacy, trustworthiness and success. Syndicates typically establish virtual offices or fictitious corporations which mirror legitimate businesses. They build a perception of legitimacy through highly professional looking websites that provide press releases and make false claims of outstanding corporate performance. They are often linked to false regulator sites and can manipulate search engine data so that those undertaking due diligence are provided with affirmative responses in relation to the investments that are being yielded,” he explained.

    The ACC says education is key to improving our steeliness against this type of crime. They have written a letter via Australia Post to every householder in Australia warning of the risks of serious and organised investment fraud in Australia.

    But they say both businesses and the public sector have a role to play in understanding the ways they can minimise risk to all consumers.

    10 Ways To Protect Your Personal Information From Identity Theft

    1. Keep virus software up to date on your computer. Install automatic updates and perform regular virus scans.

    2. Keep your privacy settings secure on all social networking sites.

    3. Keep your passwords and PIN numbers secure. Don’t carry PIN numbers with your credit/debit cards, change passwords regularly and use a variety of passwords for different purposes.

    4. Check all your credit card and bank statements each time they come in.

    5. Cross-shred all personally identifiable information which we no longer need, rather than throwing it straight in the bin.

    6. Buy a safe for your personal information at home.

    7. Don’t give any personal information or credit card details to anyone via phone or email unless you are sure the site is secure, and or you can verify the company details.

    8. Be aware of who gets your personal information and for what purposes. What can these people do with the information they are gathering? For instance, is it really necessary for the site you are registering on to have your date of birth?

    9. Keep up to date with the latest scams by subscribing to the government’s ‘SCAM watch’ website.

    10. Check your credit file for free every 12 months. By requesting a copy of your credit file from one or more of the major credit reporting agencies, you can be aware of any discrepancies which may need to investigated. Often it is only through a credit check which comes back with defaults on your credit file that many realise they have been victims of identity theft.

    Report any incident of identity theft, no matter how small, or even if you have been reimbursed for the damage – to the Police. The more people that report identity theft, the more effective will be Australia’s Government and Police response to it.

    If you are already an identity theft victim, it can be difficult to navigate the current credit reporting system to have the bad credit history removed from your credit file.

    MyCRA Credit Repairs can completely remove bad credit history such as defaults, clearouts, writs and Judgments from credit files that have errors, are unjust or just shouldn’t be there. Contact a Credit Repair Advisor on 300 667 218 or visit www.mycra.com.au for more information.

    Image: Salvatore Vuono/ www.FreeDigitalPhotos.net

     

  • Can you run a business with bad credit?

    Running a small business can be extremely trying. Cash flow can be a problem for many people with a small business, and this in turn can lead to accounts in arrears. If you are unlucky enough to incur a default on your commercial credit file during your business ownership, you could find things extremely difficult. It would be difficult to borrow more money to expand your business, or buy vehicles, or even set up a mobile phone plan. This blacklisting of your credit file can even mean you are forced to sell the business or go bankrupt, or lean heavily on your personal credit file when you need to borrow money. We cover the ways you can get bad credit, and why you should avoid bad credit history attaching itself to your business and your personal life at all costs.

    By Graham Doessel, Founder and CEO of MyCRA Credit Rating Repairs and www.fixmybadcredit.com.au.

    An article published recently by Dynamic Business shows there has been a jump in the number of businesses entering external administration:

    “According to ASIC figures, the number of businesses entering external administration in the 2011-12 year was up 9.4 percent over the 2010-11 financial year.

    CreditorWatch managing director Colin Porter said data collected by his own business suggests a 22.5 percent rise in defaults in 2012, with construction/building, retail, hospitality and printing sectors the hardest hit.

    Porter said what’s more worrying is that the value of defaults is also growing, with the average dollar amount of each default registered rising 18.5 percent. This was even more marked in the final three months of the last financial year, with Q4 2011/2012 up 22 percent on Q4 2010/2011.

    “June represented the highest number of defaults registered, plus the highest dollar value of the defaults on record,” he added” an excerpt from the article Diligence key to avoiding bad debt.

    These are worrying statistics for business owners, particularly when you see the consequences of bad credit.

    Why accounts should be paid by the due date

    Bad credit can be extremely easy to cop on your commercial credit file. And you may not have the same protections as you do for your personal debts.

    Commercial credit reporting is not subject to Part IIIA of the Privacy Act, which governs notification requirements for consumer credit reporting specifically in the Credit Reporting Code of Conduct.

    In the Credit Reporting Code of Conduct, an account must be at least 60 days in arrears, and an amount of at least $100 must be outstanding for the Creditor to be able to place the default on the consumer’s credit file.

    Whilst commercial credit has provisions in the National Privacy Principles for correction of mistakes, there is no provision for adherence to the Code of Conduct.

    So technically, if you are one day late in paying an account, a Creditor may legally be able to place a default on your commercial credit file. Despite the law, many of the Ombudsman Services do encourage Creditors to give adequate written notice to remedy an account in arrears prior to listing a default. But sometimes this issue can be a contentious one when trying to dispute what you consider to be an unfair credit listing.

    Ideas to keep the cash flowing so you don’t get in arrears

    1. Pay all accounts on time. This is the easiest way to ensure there are no discrepancies or defaults on your credit file.  You need to have systems in place whereby credit cards and all bills are paid on schedule if not by you then by administration. If the business is running behind, creditors need to be contacted and payment plans possibly worked out before the due dates to best avoid a default listing on your credit file. Many industries are tending towards offering those in financial hardship alternative payment arrangements rather than placing a default on the credit file. If you do need to request financial hardship for a case of temporary hardship, you should contact the Creditor in writing. This does not guarantee you will be successful in your request, but the Creditor has a number of days to respond prior to placing a default on your credit file for any accounts in arrears.

    2. Ensure all accounts are paid to you on time. Chase up bounced cheques and failures to pay immediately.  Too many accounts left unpaid can leave you short on cash and run your business into the ground if left to continue. Regard any client non-payment as potential risks to your credit rating.  Develop a tactful system for retrieval ahead of time – reminding clients of the risks to their credit rating by defaulting on payments to you. If overdue accounts go beyond 60 days, notify the account holder in writing you will be referring the non-payment to a credit reporting agency.

    3. Consider credit checks for all potential account holders. Anyone who requests an account of significant proportions could be required to submit a credit application before the account is instigated. This involves you running a credit check on them with one of the major credit reporting agencies. At the very least, as Porter also recommends, obtain the entity’s correct name and ABN/ACN, and verify that the ABN/ACN is active and is still legally operating.

    4. Regularly obtain a copy of your credit file – once a year is recommended to ensure it is all as it should be. If there are any discrepancies or listings which you believe should not be there, address them prior to needing the extra credit for your business. This will mean less stress for you. Clearing unnecessary defaults allows you to get on with your life, and the important business of running your company

    5. Keep credit card limits within a set budget as specified by the needs of the company. Don’t be tempted to set a lofty limit to your credit card as it may just encourage needless spending and blow out your business budget.

    6. Be aware of excessive credit enquiries. If you are not sure about your credit health, run your own check before applying for new credit.  Some lenders are rejecting loans for as little as two credit enquiries in 30 days, or six enquiries within the year – so it pays not to shop around for credit and to only apply for credit you have an intention of pursuing.

    7. Most importantly, monitor your accounts regularly.  If you are the owner of the business but not the person responsible for accounts, ensure you still have hands on knowledge of the business’ expenses.  Check accounts are being paid, check receipts and credit card statements regularly.

    In the current economic climate with businesses potentially more likely to pay accounts late, there has never been a more important time to protect your credit rating by being firm with your own and your client’s payments.

    Your consumer credit file

    SMB’s it can find be tempting to take out credit using your consumer credit rating. Redrawing on the mortgage, and taking out personal loans is evidently quite common amongst small businesses who report finding it difficult to get credit to fund their business in the current market.

    Smart Company reported back in June on new research by software firm MYOB showing 28% of small businesses use their home loan to finance their business in some way.

    The survey of over 1,000 SMEs, shows how tightly linked mortgage rates and business finance really are.

    Just under 15% of SMEs utilise a line of credit through their home loan to help fund their business, 5% have funded their business by increasing the value of their home loan and 5% funded their business by redrawing against equity in their mortgage.

    A further 4% have used cash sitting in their mortgage offset account to pump into their business.

    The danger with involving personal credit in your small business borrowing is the chance of business debt and bad credit history spilling over to the personal credit rating.

    Business is touchy and subjected to many unknowns, but the family home and your consumer credit file should be kept protected. If some major clients go under, and payments are not made – who’s going to help fund your now over-extended mortgage? You will go into a credit lock down of both consumer and commercial credit files. Your access to mainstream credit is virtually nil for the next 5 years. Not only can your credit rating be compromised, but your spouses’ as well. Any new credit will be at sky-high interest rates. You might lose the business, and any opportunities to borrow again for business in the future, but worse, you might lose your family’s ability to borrow at good rates for a mortgage, personal loan, credit cards and even mobile phones.

    So to protect your good name – choose your credit wisely, choose your clients wisely, and make paying your debts a priority – regardless of the size of your business.

    If your good name has been compromised by bad credit history, and you believe it should not be there, you may be suitable for credit rating repair. Contact a Credit Repair Advisor on 1300 667 218 or visit our website www.mycra.com.au for more information.

    Image: tungphoto/ www.FreeDigitalPhotos.net

     

  • Are you spending more than you earn? You’re not alone….

    It was reported yesterday that one in seven households in Australia is on ‘struggle street’ – spending more than it earns. It seems many Australians are living on credit, including some of our richest. We look at the concept of living on credit, and how existing this way can not only put pressure on the household, but when it all catches up and you are lumbered with bad credit history – threaten the family’s ability to get the best credit at the best rates for years to come. We look at how you get there, why you want to avoid it, and what to do about it.

    By Graham Doessel, Founder and CEO of MyCRA Credit Rating Repairs and www.fixmybadcredit.com.au.

    News.com.au featured some interesting statistics put out by the ABS yesterday in its article ‘Aussie strugglers living beyond means’:

    “One in seven Australian households is spending more than it earns, as the working poor struggle with monster mortgages and surging power bills.

    Nearly 8 per cent of the nation’s richest households were living on credit, the Australian Bureau of Statistics reported yesterday.

    Of the top 20 per cent of households earning the most money, 3 per cent could not afford to pay a gas, electricity or phone bill on time during 2009-10.

    Of the poorest 20 per cent of households, one in five could not pay their bills on time and one in four spent more than they earned.”

    Living this way is living dangerously. Often you are said to be robbing Peter to pay Paul. But if something goes wrong, you can run a real risk of getting into arrears. If your accounts fall 60 days behind, then your Creditor will place a default on your credit file – and this will impact you and your family for years and years to come. You will be banned from mainstream credit. The credit you do buy after that will be at a pretty high price. You may not even be able to get a mobile phone on a plan.

    How did we get here?

    Sure petrol prices are ridiculous, and grocery bills seemed to rise no end, and then there are reports out there that people have had to use bbq’s and eskies because they can’t pay their power bill – but the average person can afford these essentials. It’s the luxuries we have issues with – and what we consider to be luxuries and essentials today may have something to do with it.

    A while back, I blogged about the concept of “Affluenza” an idea put out there by Australians Clive Hamilton and Richard Denniss’ in their book, Affluenza: When Too Much is Never Enough.

    Affluenza is a disease of the 21st Century that can make us sick, and it can make our credit file sick with it –pulling us into a crazy cycle of spending and debt. Many of us are struggling to stay happy under a pile of ‘things’ and a pile of debt.

    It is the disease of consumerism and it is being fuelled by big corporations urging us to buy more, persuading us with clever advertising aimed at selling to our emotions. It drives us to work crazy hours leaving no time for ourselves and our families. It drives up the mental health problems, the suicide rates, the divorce rates, the drug addictions, fraud, the stress related health problems – all these things seem to be a curse of living in the 21st Century in the Western world.

    Here is an excerpt from that book:

    “Our houses are bigger than ever, but our families are smaller. Our kids go to the best schools we can afford, but we hardly see them. We’ve got more money to spend, yet we’re further in debt than ever before. What is going on?

    The Western world is in the grip of a consumption binge that is unique in human history. We aspire to the lifestyles of the rich and famous at the cost of family, friends and personal fulfilment. Rates of stress, depression and obesity are up as we wrestle with the emptiness and endless disappointments of the consumer life.

    When I read yesterday that one in seven of us are still living on borrowed money, it makes me realise that not enough Australians understand the power of credit. It is a great concept, but as long as we make it work for us. We should use it to enhance our lives so that we can spend time with the ones we love, or to really improve our quality of life. Not make ourselves slaves to it.

    Maybe we throw that long sought after holiday on the credit card and take the family away? Or take out repayments on an educational course that will change our working lives forever? Or perhaps we do buy a home, but after years of good saving. One that fits all the requirements of what we need, rather than what we want. A home we don’t have to work 24/7 to pay off because it is priced within our means.

    What we shouldn’t do is spend money we don’t have, on things we don’t need, and ultimately find ourselves with what we don’t want – debt, unhappiness and a bad credit history.

    What does your credit file say about you?

    We should think of our credit file as a mirror on our finances. It can reflect our assets, our good history, but it can also reveal our financial shortcomings. It can be a reflection of our inability to stick with something, our disregard for repayments and it shows the financial potholes we fall into that are sometimes impossible to climb out of.

    A bad credit rating can completely change our financial situation. The black marks placed there by creditors show up on our credit file for 5 years. Bad credit can limit our choices and can perpetuate the debt cycle by leading us to choose loans with higher interest rates and more fees, so the struggle to make repayments can be even harder.

    If we want to try and start again with credit, it may be possible to wipe the slate clean, particularly if our bad credit rating should not be there.  Firstly, we can obtain a free copy of our credit report from one or more of the credit reporting agencies, Veda Advantage, Dun & Bradstreet and Tasmanian Collection Services (TASCOL). If after checking our credit file we find inconsistencies, we may be a good candidate for credit repair.

    A credit repairer can work with creditors on our behalf to completely clear our credit file of all defaults, clear-outs, writs and Judgments which contain errors, are unjust or just should not be there. This means we no longer have a bad credit rating, but a completely clear credit file, giving us the financial freedom to use credit whenever we need to.

    The rest is up to us.

    Contact a credit repair advisor on 1300 667 218 for more information on repairing bad credit, or visit our main site www.mycra.com.au.

    Image: hin255/ www.FreeDigitalPhotos.net

     

     

  • The 7 worst mistakes you can make with credit which can lead to defaults

    What are some of the big mistakes made with credit which could lead you into battling debt and having creditors sending letters of demand and listing defaults on your credit file? We look at the 7 mistakes with credit that could increase your changes of getting bad credit history.

    By Graham Doessel, Founder and CEO of MyCRA Credit Rating Repairs.

    1. Leaving no room for emergencies

    Borrow within your budget. If you have a revolving line of credit or use credit cards you will need to be disciplined. Consider what you can afford and try to live frugally, rather than spending right up to your credit limit. It’s important to realise that you will pay at some point for the credit you use. If you are consistently struggling to make your repayments – then it’s time to take stock of things. Many people get into trouble with their repayments and end up with defaults on their credit file because – well – life happens and they haven’t left any room in their repayments for saving or for emergency funds. Try to separate wants from needs when you borrow.

    2. Thinking you need a large credit limit

    Ignore what the card company or bank sets for your limit – what can you comfortably afford to repay? If you intend to apply for further significant credit in the future, you will need to consider that a lower credit limit looks better to a prospective lender – so if you don’t need it – consider reducing it.

    3. Redrawing on your loan

    If you have a redraw facility on your loan – the temptation can be high to borrow against it. But you should tread carefully here. Remember you are going to be paying interest on this money – you may be better to just save it from your wages. Credit cards can also offer cash advances, but do bear in mind the interest charges on this money are exorbitant. Cash advances are a common way people can blow out their credit card debt to epic proportions leaving them no way to pay, and with defaults which destroy their ability to get new credit for 5 to 7 years.

    4. Choosing the wrong kind of credit

    Make sure your credit suits you. Make it work for you, not the other way around. What kind of payer are you? What do you need the credit for? There’s no point getting a line of credit if you are the big-spender type – you are certain to get into trouble. These types of facilities only work if you are disciplined with your spending. When you choose a credit card – consider what you need it for. If you are going to use it a lot – perhaps the rewards points could be a deciding factor. But if you are only going to use it sporadically – maybe the annual fees should be more important.

    The same goes for any big ticket item you purchase using credit – like houses and cars. What does it need to do for you? What can you actually afford? How long will you need it for? Remember a car always depreciates in value. And whilst houses can make you money in the right market, and possibly a 4 bedroom ensuite home might be a good long term investment – can you actually afford to live comfortably with this debt? If you need to go down to one income at some point – how will your repayments look then? It can cost you thousands in agent’s commission, stamp duty and legal fees to sell if you decide you have bitten off more than you can chew after you move in. Or if you default on your repayments you will probably be unable to borrow for years to come – so choose wisely.

    5. Repaying only the minimum amount

    On credit cards, you should pay off the entire credit card balance within the interest free period to avoid the high interest charges. If you don’t, you will be charged interest right back to the date you purchased each item. You not only lose the interest-free period on those past purchases, but until you pay off the balance there will be no interest free period on anything you spend in the future. This can see some people come unstuck and their credit card debts can snowball with interest until they reach the point where they are unable to pay and begin to get into arrears.

    You can find low interest credit cards, but it is still advisable to pay more than the minimum repayment amount each month. If you have debt which carries over on your card month to month you should look at a card that has a lower interest rate. There may not be as many ‘perks’, but the lower interest rate should mean the carried over debt is more manageable for you, and will prevent possible bad credit history.

    Likewise on any other type of loan that you actually want to pay off – paying the minimum amount will not get you there. You will need to pay a significant amount more to start paying into the principle – especially in the early days of the loan.

    6. Not Checking Statements

    You should check that your credit and debit card statements are correct every month – and query anything you’re not sure about. Maybe you were charged twice for an item, or charged too much. It is a good way to be alerted early to identity theft as well. You should also check your bank account statements in the same way.

    Checking your statements will also allow you to get a good handle on just where you’re spending too much and allow you to adjust your spending next month to compensate.

    7. Not Checking Your Credit Report

    Most people don’t know that every year they are able to request a copy of their credit report for free from Australia’s credit reporting agencies. This report is important, because it shows you how you will be viewed by lenders if you ever apply for a loan. You should check that all of your personal details are correct. You should check the credit enquiries are valid (id theft risk). You should also check to see whether you have any negative entries against your name. Defaults, Clear-outs, Judgments, Writs can all mean you will be refused credit if you apply.

    If you don’t believe the credit listing should be there, if you didn’t know about it or you think there might be a mistake, then the worst thing you can do is leave it there. It will mean you are locked out of mainstream credit for between 5 and 7 years – depending on the listing type. It will often mean you are told by Creditors and the agencies that the bad credit is there to stay for the term – it can’t be removed. But this may not be true.

    For professional advice on how to tackle Creditors and the credit reporting agencies about a listing which should not be there, a credit repairer will be able to determine whether your circumstances would allow for repairing the credit rating and actually negotiating the removal of the bad credit history from your credit file.

    If you want to see what is said about you on your credit file, you can contact MyCRA Credit Rating Repiars to request a free copy of your credit report. We can also help to repair bad credit history, or give you more information on your credit rating. Visit our website www.mycra.com.au or call MyCRA Credit Rating Repairs tollfree on 1300 667 218 for more details.

    Image 1: adamr/ www.FreeDigitalPhotos.net

    Image 2: David Castillo Dominici/ www.FreeDigitalPhotos.net

     

  • Will the spring boom be mowed down by bad credit?

    Spring has almost sprung – which is evident by the sunny weather spanning much of Australia today. We look at what this might mean for the housing market, and why this is the best time for people to get cracking on making sure their credit file comes up smelling like roses.

    By Graham Doessel, Founder and CEO of MyCRA Credit Rating Repairs and www.fixmybadcredit.com.au.

    Traditionally spring is the season where people dig out the clip-boards and the comfortable buying shoes and go get pre-approval for some serious house-hunting.

    Spring is a great time to buy due to more property on the market – transfers; people planning for moving prior to the new school year; people with pools selling when it’s warmer; and homes generally look prettier in the spring – can contribute to this rise in good stock. And for the same reasons, more buyers can be available at this time, which potentially means more borrowers.

    But RP Data’s Executive General Manager, Craig McKenzie told Australian Broker Online today that the 2012 spring selling season would be largely determined by levels of buyer confidence in the market place. He warned a lack of confidence would hamper activity.

    “Until such time as there is a sustained recovery in the consumer mindset it seems unlikely there will be a vast improvement in sales activity,” he said.

    The Housing Industry Association’s chief economist Harley Dale also echoed this belief.

    “The consistently weak consumer confidence is weighing very heavily on new housing investment, far more so than is the case for retail expenditure,” he said.

    “Combine that low confidence with very tight credit conditions and excessive taxation, and you have the unpalatable recipe for the recessionary conditions facing new housing.”

    I would argue nothing exudes buying confidence like pre-approval for a home loan. But this thinking can sometimes see people come unstuck if they’re not careful. If people don’t know what is said about them on their credit report before they apply for finance – they will find out after. If the news is bad – if they have a bad credit listing there – this would mean they are refused credit, and would also have created a credit enquiry on their credit report. “Tight credit conditions” mean any blemish on the credit report – including too many credit enquiries – can see a person refused credit.

    Most people think if they had any kind of black mark on their credit report they would know about it. But unfortunately “surprise” bad credit is pretty common. Bills and notices get sent to the wrong address; mistakes happen; listings are put there unfairly; or in some cases the wrong person cops the bad credit of someone else entirely. But if people apply for finance and their credit report comes back with nasties – the banks probably won’t be very understanding – they consider these blemishes require them to undertake too much ‘risk’ on the loan.

    In most cases the best way to alleviate bad credit history bringing undone all the hard work and savings that have gone into getting a person ready to buy is by using the free yearly credit report to check that everything on their credit file is as it should be before applying for finance.

    The very people who should be ordering a copy of their free credit report are the people who think their credit file should be returned clear. It only takes 10 days to receive it in the mail, but its piece of mind and ‘confidence’ to know that everything is as it should be.

    No amount of “fast talking” or explaining will take back that credit refusal if it occurs. The only thing that will fix a bad credit listing is to address the credit listing at its source – with the Creditor and if it shouldn’t be there – request its removal.

    But why should people use a credit repairer?

    For people who have ever tried to call up and fix their phone troubles, they can be on hold for hours; they can be passed from one person to another; and in the end, still hang up dissatisfied. Clients say it is a similar situation when trying to dispute a credit listing.

    Most times they are told (eventually) that listings can only be marked paid and cannot be removed. But this is not true. If a listing has been placed unlawfully on a person’s credit file, then it should be removed.

    What it takes to negotiate the removal of a credit listing

    • Ability to review pages and pages of documentation
    • Ability to be patient and go through the proper channels to request documents and information
    • Ability to build a strong case as to why a listing has been placed unlawfully based on client information crossed with relevant legislation
    • Ability to negotiate directly with the people that matter within the company in question
    • Knowledge of how to escalate a complaint when necessary, for the best outcome of the client

    Working within the law, a professional credit repair firm gives people the best chance of completely removing bad credit which should not be there. This way, they can apply for finance with a clean slate – achieving the interest rate of their choice, and saving themselves thousands.

    If someone is dreaming of white picket fences, the best way for them to confidently take charge of their “approvability” is to take charge of their credit file and what is says about them. With a clear credit file, they will be able to confidently apply for pre-approval, without stress, negotiating that best price on the house of their dreams.

    To order a free copy of your credit file, or for more information about professional credit repair contact MyCRA Credit Rating Repairs on 1300 667 218 or visit our main site www.mycra.com.au.

    Image 2: dan/ www.FreeDigitalPhotos.net

    Image 3: anankkml// www.FreeDigitalPhotos.net

  • W.A Government to toughen up on identity checks to combat identity fraud

    Western Australia’s Births Deaths and Marriages just got that little bit harder to swindle with the introduction of tighter identity controls to prevent identity theft and fraud. The changes come into effect next week and will mean anyone who applies for a birth, death or marriage certificate or a name change will have to provide at least three forms of current identification. We look at what these changes will mean in preventing fraud and subsequent bad credit history that shouldn’t be there, and why the positives of increased security outweigh any ‘inconvenience’.

    By Graham Doessel, Founder and CEO of MyCRA Credit Rating Repairs and www.fixmybadcredit.com.au.

    Attorney General Michael Mischin told Perth Now yesterday these tighter measures are designed to ensure those who are entitled to access personal information can do so easily, while deterring those who are not.

    “In the past few years thousands of West Australians have been affected by identity crime with millions of dollars stolen from innocent people,” Mr Mischin said.

    Under WA law people can face up to seven years jail if they produce, use or supply another person’s identification when there is intent to use that information to commit a crime, or facilitate someone else to commit a crime.

    The nature of this form of identity crime is pretty complicated, but the payoffs for the criminals would be huge. This type of identity fraud involves the use and misuse of someone’s personal information. Fraudsters may have one piece of the identity puzzle that they may have obtained from somewhere – say a credit application dumped un-shredded in a rubbish bin, personal details from social networking, or perhaps a stolen wallet containing a licence or bank account. What the fraudsters then do is look at piecing together different bits of information – requesting replacement copies of basic identity documents, even changing addresses until they have enough information to commit fraud. The icing on the cake for this type of identity fraud – would be obtaining a replacement copy of an actual birth, death or marriage certificate.

    If fraudsters had this type of document, they could easily apply for new credit in their victim’s name – even going so far as to mortgage a property in their victim’s name.

    The ramifications of this crime would be absolutely devastating for the victim. They would not only be in debt thousands and thousands of dollars, but also facing a series of defaults against their name which would stop them getting credit in their own right for a very long time (up to 7 years).

    Western Australia has not been without its share of well-publicised fraud cases. One such bout late last year involved the mortgaging of properties owned by overseas investors.

    In 2010 Wembley Downs retiree Roger Mildenhall had his Karrinyup investment property sold without knowing anything about it. And in 2011 Nigerian-based scammers sold a Ballajura property without the owners’ knowledge.

    The previous owners were living and working overseas at the time and didn’t discover the property had been sold until they returned to Perth to inspect the property.

    The real estate agent involved has told investigators that he received a phone call from a man claiming to be the owner in February of 2011 inquiring about the property. Shortly after, the agent received an urgent request to sell the property as funds were needed for a business investment, later revealed to be a supposed petro-chemical project –  Landgate announced in a statement in September last year.

    Following this, the WA Government was prompted to upgrade its security measures for overseas-based property owners.

    “WA property owners living abroad who are concerned about identity theft can now lodge a caveat over their property to reduce the risk of being targeted by scammers, under a raft of anti-fraud measures introduced by Landgate,”Lands Minister Brendon Grylls said at the time.

    “They could remove the caveat only by attending Landgate’s Midland office in person and completing a 100-point identity check”, Mr Grylls said.

    Under the range of increased security measures, all transfers of land executed overseas now requires a 100-point identity check, signatures to be witnessed by an Australian Consular officer and the sales will need to be independently checked by at least two senior Landgate officers.

    The introduction of new security at the Births, Deaths and Marriages Departments seems a no-brainer, and a change which should be going across the board in every Australian State.  A person’s identity and their credit file are the flag for their financial life, and to allow any fraudster opportunity to mess with that through less than bullet-proof security of their personal information is to do them a great disservice.

    If you have been a victim of identity theft – whether you have lost money or not – don’t forget three important rules…

    1. Tell Police and/or the ACCC. We must report these crimes – however “embarrassing” it may be.

    2. Tell your Creditors. Just because nothing has happened yet, doesn’t mean it won’t in the future. Alert them to your identity theft vulnerability before you become a victim and your bank accounts or credit rating suffers.

    3. Check your Credit File. Make sure you have not had credit taken out in your name. If you haven’t – warn the credit reporting agencies that you may be vulnerable to identity theft.

    If you find defaults on your credit file which should not be there, you may require help to recover your good name. Contact a Credit Repair Advisor on 1300 667 218 to discuss your suitability for credit repair or visit our main site for more information www.mycra.com.au.

    Image: photostock/ www.FreeDigitalPhotos.net

  • What’s the outlook for housing demand?

    Is it doom and gloom for the housing market going back to GFC-level lows? Or is the housing market stabilising? Veda says there are more mortgage enquiries for the April quarter indicating things are evening out, but the HIA has previously warned new home loan numbers will dip significantly for the rest of 2012. We consider the published figures, and look at what this may indicate for new loans and brokers and credit repairers alike heading into the second half of 2012.

    By Graham Doessel, Founder and CEO of MyCRA Credit Rating Repairs and www.fixmybadcredit.com.au.

    The results of  Veda Advantage’s Consumer Credit Demand Index for the second quarter of 2012 shows mortgage enquiries were up (+0.7%) for the quarter building on the small rise (+0.2%) seen in the March quarter.  Whilst still at historically low levels, Veda says the last two quarters results confirm that mortgage enquiries are stabilising.

    “Mortgage enquiries are a good lead indicator of housing demand. This stabilisation in mortgage enquiries suggests housing turnover is also stabilising. Lower interest rates and an improving housing affordability index align with the observed stabilisation in enquiries, after many quarters decline.” Angus Luffman, head of consumer risk at Veda says.

    Veda says the RBA’s cuts in May and June appear to have helped lift consumer sentiment close to a neutral level. However, fears about the global and domestic economic situation, in addition to share market declines and labour market uncertainty means that consumers remain cautious about credit.

    This optimism contrasts with concerns expressed earlier in the month by the Housing Industry Association (HIA) and reported in Australian Broker, which warns the second half of 2012 will see new home loan numbers dip to GFC-level lows.

    HIA is reportedly commenting on data released in conjunction with findings from the Australian Bureau of Statistics.

    HIA’s chief economist Harley Dale said it was a “disappointing result.”

    “It is evident that new home starts will bottom at GFC-equivalent levels this year, which is a very poor outcome for Australian businesses, households, and therefore the wider economy,” he tells Australian Broker.

    Figures show an overall dip of 2.4% in May, although it did show state-level growth across Queensland, South Australia and Tasmania.

    Australian Broker reports decline was recorded across NSW, Victoria and the Northern Territory, which reportedly lead the pack at an alarming 23.8% drop.

    “We needed to be seeing a strong recovery in new home lending coming through in the first half of 2012 to signal a significant turnaround in residential construction from what will historically be a very low trough,” said Dale.

    “That simply isn’t the case and government action in addition to lower borrowing costs is the combination required to restore healthy levels of confidence and activity.”

    Official figures for Housing Finance Data for May 2012 from the Australian Bureau of Statistics do indicate a fall in housing finance from April to May, but the latest figures show the number of new dwelling commitments actually rose marginally (0.8%) and the number of commitments for the construction of dwellings rose 0.3%.

    ABS HOUSING FINANCE MAY 2012 KEY POINTS

    VALUE OF DWELLING COMMITMENTS

    May 2012 compared with April 2012:

    ■The trend estimate for the total value of dwelling finance commitments excluding alterations and additions fell 0.5%. Investment housing commitments fell 0.7% and owner occupied housing commitments fell 0.3%.
    ■In seasonally adjusted terms, the total value of dwelling finance commitments excluding alterations and additions fell 1.4%.

    NUMBER OF DWELLING COMMITMENTS

    May 2012 compared with April 2012:

    ■In trend terms, the number of commitments for owner occupied housing finance fell 0.5%.
    ■In trend terms, the number of commitments for the purchase of established dwellings fell 0.6%, while the number of commitments for the purchase of new dwellings rose 0.8% and the number of commitments for the construction of dwellings rose 0.3%.
    ■In original terms, the number of first home buyer commitments as a percentage of total owner occupied housing finance commitments rose to 17.8% in May 2012 from 16.8% in April 2012.

    So what can we expect from mortgage enquiries heading into the second half of 2012?

    Our experience in dealing with brokers daily shows that generally enquiry level and loan numbers are fairly good (within reason depending on the brokerage type) and there is much more positivity out there than there was six months ago. Most of this we assume can be attributed to the drop in interest rates earlier in the year.

    Regardless of numbers, with global economics still dim, lending criteria will probably continue to be conservative, and bad credit history will continue to be a big reason we see mortgage applications declined for some time to come.

    But it will also still be likely that applicants who present with bad credit may have grounds to dispute their credit rating if the listing is deemed to have been put there unlawfully – and there are a whole host of reasons why this may occur. You can check your client’s credit repair suitability with us any time by calling 1300 667 218. And because of the continuing difficulties faced with Creditors and the need for extensive knowledge of credit reporting and industry legislation, it will remain necessary for those people who want to dispute credit rating mistakes to have on their side a professional credit repair firm to be able to negotiate that removal effectively.

    Image: renjith krishnan/ www.FreeDigitalPhotos.net

  • How Malware can infect your life and put you and your credit file at risk of fraud

    Think malware is a term used to describe clothes you go shopping in? Then you might have a big problem. Malware is what’s known as a syntactic form of identity crime – where fraudsters attempt to exploit technical vulnerabilities in order to commit fraud. Today the total malware count is just shy of 80 million. That’s scary stuff. We tell you exactly what it is, and what you can do to prevent your personal information from being exploited by fraudsters and prevent debt and bad credit history from credit fraud.

    By Graham Doessel, Founder and CEO of MyCRA Credit Rating Repairs and www.fixmybadcredit.com.au.

    Last week I received a warning from the Stay Smart Online alert service about a new spam email containing a Trojan horse virus as an attachment. This must have caught out enough people for SSO to put out a warning about it. In fact, new forms of malware catch out millions of people every day. It is reported there are 55,000 new unique malware samples per day sent out there. So how can we stay on top of it?

    Stay Smart Online defines malware, and explains how it can infect your life through your computer:

    What is ‘malware’ and how does it affect your computer

    Malware—short for ‘malicious software’—is the term often used to refer to any type of malicious code or program that is used for monitoring and collecting your personal information (spyware) or disrupting or damaging your computer (viruses and worms).

    Spyware

    The term spyware is typically used to refer to programs that collect various types of personal information or that interfere with control of your computer in other ways, such as installing additional software or redirecting web browser activity.

    Examples of spyware include:

    Keyloggers

    A keylogger is a program that logs every keystroke you make and then sends that information, including things like passwords, bank account numbers, and credit card numbers, to whomever is spying on you.

    Trojans

    A Trojan may damage your system and it may also install a ‘backdoor’ through which to send your personal information to another computer.

    Viruses and worms

    Viruses and worms typically self-replicate and can hijack your system. These types of malware can then be used to send out spam or perform other malicious activities and you may not even know it.  Both can use up essential system resources, which may lead to your computer freezing or crashing.  Viruses and worms often use shared files and email address books to spread to other computers.

    How does your computer become infected with malware

    Most spyware is installed without your knowledge. It often gets onto your computer through deception or through exploitation of browser vulnerabilities.

    •Spyware can come bundled with other software. When you download a program, the spyware can be downloaded and installed at the same time.
    •Some spyware infect a system through security holes in the Web browser or in other software. When the user navigates to a Web page controlled by the spyware author, the page contains code which attacks the browser and forces the download and installation of spyware.
    •Be wary of USB sticks from unfamiliar or untrustworthy sources, for example those given away at conferences, trade shows, or in promotional packs. These devices may contain malicious software, which could cause severe damage to your computer or compromise your personal information.
    •Some “rogue” spyware programs masquerade as security software.
    •Worms can also be used to install spyware on your computer.

    A recent article published in the Sydney Morning Herald Tech Section has some alarming concerns from some pretty hefty security people about the internet’s battle with malware. Many wonder if we could possibly be losing the fight against it – with updates unable to keep up with new developments, and anti-virus letting some slip through the cracks. If you’re game, you can read this article here: Anti-virus can’t keep up with threat onslaught.

    Concerns aside, far and away the best way we can have any hope of fighting it – is with installing updates on our computers. Here are Stay Smart Online’s best tips for preventing malware:

    How to prevent spyware from getting onto your computer

    •Install anti-spyware and anti-virus software and set it to automatically check the product website for updates. This will ensure that your computer is protected against the latest viruses and spyware.

    •Install a firewall. It will prevent unauthorised access to your computer and the installation of spyware on it. Some firewalls can also prevent information being taken from your computer and sent to someone else.

    •If you must use a USB stick from an unfamiliar source, you should always scan the USB stick for viruses or other malware before accessing any of its content. You should also disable the autorun function, which is commonly enabled on the Microsoft Windows operating system. This will lessen the risk that any malicious software that may be on the USB stick, will automatically start when you connect it to your computer.

    •Keep yourself informed about the latest security threats and solutions. You can sign up for the free Cyber Security Alert Service from this website. Alternatively, your anti-virus software vendor may have an email alert system. Look for a ‘keep informed’ tab or section on the software’s main screen.

    •Be cautious about opening emails from unknown or suspicious sources. Look at the sender of the email as well as the body and the subject of the email. Do not open email attachments or click on hyperlinks in these emails. You should install spam filters to minimise the amount of spam you receive.

    •Set your anti-virus software and anti-spyware software to automatically scan incoming email.

    •Only download files and software from reputable web sites. Read the licence agreement and terms of use before you download software and don’t download it if you don’t understand or trust the terms and conditions.

    •Be wary when exchanging files even with colleagues or friends. Scan the files before you install them or run them on your computer.

    •Never click on an ‘Agree’, ‘Ok’ or ‘No’ button to close a window on a suspicious website or pop-up. This can launch spyware onto your computer. Instead, click the red ‘X’ in the corner of the window to close the window.

    Your credit file at risk

    In SMH’s article, Charles Wale, security and risk consultant at Lee Douglas and Associates, who has consulted for over 50 ASX-listed companies says consumers need to realise their machines are targets.

    “They are after your personal information for identity theft and login details, especially for banking sites so they can remove funds in their favour,” he tells SMH.

    What can fraudsters do if they can get their hands on your personal information?

    They can steal passwords to your bank or credit accounts and they can also create a patchwork quilt of information that can allow them to eventually have enough on you to request duplicate identity documents, and apply for credit in your name.

    Running up credit all over town, perhaps buying and selling goods in your name, or in some cases mortgaging properties – the victim can have a stack of credit defaults against their name by the end of their ordeal – and sometimes no proof it wasn’t them that didn’t initiate the credit in the first place.

    Recovery can be slow, and in some cases victims have had no way to prove they weren’t responsible for the debt – with fraudsters leaving no trail and the actual identity crime happening long before the fraud took place.

    So to prevent devastating identity crime, which leaves you in debt and can leave you without any way of obtaining new credit for years to come, make it your business to educate yourself on internet and or computer risks. And think before you click….it could save your financial future.

    If you need help in recovering your good name following identity theft, you may find a professional credit repairer can give you the best chance at having the defaults removed from your credit file. Contact MyCRA Credit Rating Repairs on 1300 667 218 for more information.

    Image: Idea go/ www.FreeDigitalPhotos.net

     

  • Women and Credit: What You Need to Know

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    Bad credit history plays no favourites, it can basically happen to anyone. Both sexes can be severely disadvantaged when it puts a halt on plans to borrow money. In this post we explore some issues around credit, women in particular may need to be aware of and show how important financial knowledge and independence is to ensuring a good credit history for both women and men.

    By Graham Doessel, Founder and CEO of MyCRA Lawyers and www.fixmybadcredit.com.au.

    The title of this post came as inspiration from a blog post concerning women and debt.  The post was titled Build A Clean Credit History and it centred around the issue of women and credit and how women can sometimes let their partners have control of the finances to their own detriment. The blogger “Women In The Black” is a forum for women to discuss personal finance, saving, investing and ‎building wealth. ‎

    Women In The Black implores women to get involved in their own finances rather than leaving it to their partner, in order to build up a good credit history of their own.

    “I’ve heard stories of women in their 50’s, who are either divorced or widowed, and have had to begin managing their finances now, which they previously didn’t have to do. Be assured at some stage in your life, you’ll be the sole manager of your finances,” the post says.

    “No matter what age you are, you need to take an assertive fiscal approach to money. Focus on earning more money as well as managing your debts which will lead to a long clean credit history.”

    Both men and women need to be educated and ultimately responsible for their own finances, and particularly their own credit history.

    Here are some of the issues women may come across when it comes to their credit rating but this can apply to men as well…

    Not knowing about your finances

    Do you know how much your insurance is per year? Do you know when your registration is due, or how the phone bill is paid? Leaving all the repayments up to your partner and never verifying them is a recipe for disaster most of the time when it comes to your credit rating. Women should strive to make joint financial decisions with their partner, regardless of their income level and both women and men should know what is said about them on their credit file by applying for their annual credit file check once per year.

    Financial incompatibility

    Sometimes we can get mixed up with someone who ticks all the boxes on an emotional level, but who has very different ideas about money, or perhaps a debt-ridden past.

    It’s important to ask some tough questions about new partners – including whether they have any current debts, if they always pay their bills on time and generally how they feel about money. You could even go so far as to order a copy of your credit file – to prove to each other that you are both default-free!

    If their answers prove less than ideal – you might want to keep your finances separate especially if you have assets of your own.

    A tangled web of credit history

    At MyCRA we often see people who have been left with bad credit history due to the partner’s financial mistakes.

    You see, when you branch out and make a life with someone, inevitably the lines of whose credit is whose can become blurred. You can have a phone account in one name, electricity in the other, a mortgage in one or both. Often it doesn’t matter whose name is on it, as long as someone is paying it – it’s more a joint effort to get the household where it needs to go and you both figure it’s ‘yours’.

    But where this goes wrong time and again is at the point where couples are trying to divorce or separate.

    Then those blurred lines of credit history can be extremely confusing, and often the divorcees’ credit histories can be mixed up long after they have physically separated. When you separate and there’s joint debt, you can lose control of your finances.

    Often we see people at the mercy of their exes’ big ‘post-relationship spendathon’ –  whether that be redrawing on the mortgage, or just taking out credit they don’t pay back – and sometimes both credit histories take the fall.

    Years later, when the woman finally gets back on her feet, she might want to get a house in her own name, or a car or even a credit card, and is refused due to bad credit that she hasn’t had any part of.

    One thing we maintain with everyone who is going through a divorce or a separation is to try to look forward into the future to what you need to do right now to prevent a bad credit score down the track.

    If you have just left your partner or spouse, here are 10 steps to financial separation you should take as early as possible in the break-up to keep your clear credit file. If these steps can be accomplished together, you can both get on with your lives as individuals without a bad credit score:

    10 Steps for financial separation

    1. Cancel joint bank accounts. Don’t hold on to joint accounts and assets ‘just in case’ you reconcile. Even the most amicable of separations can potentially turn sour down the track. The sooner you make the break, the better off your future will be – even if you do decide to get back together in the future.

    As far as creditors are concerned if the debt is in both names, then you are both responsible for it regardless of who accrued it. You could use the money from these accounts to go towards paying off any debts you may have together.

    2. Pay off and cancel joint credit cards. If the debt on the card/s can’t be paid off, inform the creditor that you have separated and ask them to put a stop on the account so there may be no more transactions. They could possibly make arrangements to transfer the repayments to two separate accounts.

    3. Resolve the mortgage debt. Sell the home and divide the proceedings, or sell your share of the home to your ex-spouse or vice-versa. Before this takes place, notify the bank you have separated. Make sure no further amount can be redrawn on the loan and that you receive separate statements whilst you are separated and both still own the property.

    4. Transfer names on other accounts. Phones, electricity accounts, rental properties, rates, car loans and store credit should all be transferred to one name as appropriate.

    5. Pay any unpaid accounts. No matter who has accrued these debts, the creditors will still see you as responsible. Ensure all accounts are paid on time while they are in both names.

    6. Keep a record of all undertakings. Keep good paperwork and notes related to the separation, including cancellation or changes to any accounts for future reference.

    7. Employ a good family solicitor. Legal advice is important as it relates to children, family businesses, and property. Also if anything runs off course with the division of debt, they can give good advice on the next course of action.

    8. Notify credit reporting agencies. Let Equifax (formerly Veda Advantage), Dun & Bradstreet, or Tasmanian Collection Services know of your separation and any steps you have taken to separate accounts to-date.

    9. Check your credit file. Request a copy of your credit report and check each entry.  A free copy of your credit file is available every 12 months from one or more of the credit reporting agencies in Australia. This is essential particularly if the settlement is drawn out over a number of years.

    10. Seek help from a professional credit repairer for any defaults, writs or judgments. Once outstanding accounts accrued by your spouse are paid, there is the issue of the bad credit score which needs to be cleared so you may have the opportunity to borrow again in the future. However, dealing directly with creditors could be problematic, they will tell you that defaults are never removed but can be marked as paid. However, at the moment even ‘paid’ black marks against your name can be enough for credit refusal, particularly if you are trying to buy a new property on one income.

    A professional credit repairer can check the creditor’s process of listing defaults for legislative and or compliance errors, any such errors could deem the credit file default listing unlawful, advising the creditor to remove the default.

    Image 1: twobee/ www.FreeDigitalPhotos.net

    Image 2: graur codrin/ www.FreeDigitalPhotos.net

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  • How You Can Give Yourself the Best Chance of Being Approved For Your First Home

    A great deposit and a great income is not enough to ensure you get the home loan that’s right for you. We show you how your credit rating can have just as much impact as your savings record and show you the steps you can take to ensure your credit file accurately reflects your ability to repay a home loan.

    By Graham Doessel, Founder and CEO of MyCRA Credit Rating Repairs and www.fixmybadcredit.com.au.

    There is more to applying for finance than wages and savings records. One of the key factors to home loan approval is your credit report.

    What is a credit report?

    A credit report is a report on your credit file status (or credit rating), held by one or more of Australia’s credit reporting agencies.  Your credit file is checked by the lender when you apply for a home loan. It contains all of your personally identifiable information as well as your repayment history, and is used to assess both the amount you are able to borrow and your ability to repay the loan.

    Anyone who has borrowed money, or has established an account for services is credit active and will have a file in their name. This includes mobile phone plans, accounts with utility companies, rates accounts and of course loans of any kind.

    What is defined as a ‘bad’ credit rating?

    In broad terms, any credit defaults, court actions or writs, external administrations and bankruptcy are all recorded on your credit file and would be considered ‘bad’ credit history by most credit providers.

    In this current economic climate defaults and even too many credit enquiries or applications for credit may be considered to be tarnishes on your credit rating.

    How do I know if I have a bad credit rating?

    If you are unsure what is on your credit file, it would be worth taking the time to find out.

    There are three major credit reporting agencies in Australia: Veda Advantage – which holds the credit file of over 16 million Australians, Dun and Bradstreet and Tasmanian Collection Service.

    You can write to or email one of these agencies and request a copy of your file.  If you are not in a hurry there is no charge to you but it will take 10 working days from application to receive this information.

    What many people do not realise, is how easy it is to have a default slapped on their credit file.  If you fall into arrears on your account for more than 60 days (including rates, power and mobile phones) then the credit provider has the right to notify you of their intention to record this default against you on your credit file. Even if this bill is later paid, this ‘paid’ default still remains on your record for 5 years.

    Will I always know I have bad credit?

    NO! This is one of the key things we want all home buyers to know. Mistakes can and do happen, and it may not be until you are sitting in front of the bank getting rejected for a home loan that you find out you have bad credit history.

    There are a great number of credit files which contain errors or listings on credit files which shouldn’t be there, so even if you think you have never paid a bill late, you may still have a bad credit rating. It is always worth taking the time to find out before you apply for a home loan.

    I have found defaults on my credit rating, what are the consequences of this?

    If you discover you have an adverse listing or ‘bad credit rating’, you will find it very difficult to find a home loan with a mainstream lender. Generally this problem will keep occurring for the 5 years the default is on your credit file. If you decide to enter a non-conforming loan, you may be up for tens of thousands more in interest repayments just over the first three years of the loan.

    What can I do to fix my bad credit rating?

    Once you have obtained a report there are three things to consider:

    1. Check the accuracy of the report. If there are errors, be aware you do have the right to have errors rectified.  Likewise, if there are numerous strange defaults and or applications for credit that you don’t recognise – you would need to immediately investigate these and notify Police in case of identity fraud.

    2. Check you were informed of any intention to list. Current legislation requires you to have been informed in writing of any intention from creditors to list you as a defaulting on credit.

    3. Check the fairness of the listing. Only serious credit infringements should be recorded, or overdue bills in which 60 days have elapsed since payment was due.

    How does a credit repairer work to repair my credit rating?

    In many cases where people have attempted to dispute or remove the default themselves, they have come across difficulties and defaults have not been cleared. Most times the creditor will explain to the client that defaults DONT EVER get removed. The best they can do is mark the listing as paid (if it’s been paid).  This may not be sufficient to ensure credit is obtained with most lenders.

    If you have a default, writ or Judgment that has errors or just shouldn’t be there – there is a good chance that My CRA can actually remove it – meaning your financial future is looking a whole lot brighter.

    The credit repairer works with creditors to negotiate on your behalf and work for your best outcome based on the creditor’s compliancy with the current legislation. We will also look at any other extenuating circumstances to determine if there is an avenue we can investigate which results in having the listing removed.

    Should I try to cut out all credit from now on?

    Credit is not all bad.  In fact, not having ever taken out credit can harm your chances of obtaining a home loan just as much as having a bad credit rating.

    However, we do advise you to be cautious with credit. Start small, for instance a mobile phone plan or store credit card and repay the account on time, every time.

    What can I do to maintain a good credit rating?

    1. Make all payments on time. This is the easiest way to ensure there are no discrepancies or defaults on your credit file.
    If you are unable to make a payment on time, contact the creditor. They may be able to set up a payment plan for you until you get back on your feet. Soon overdue accounts that are as little as one day late will be recorded on your credit file as ‘overdue payments’ and will stay there for 2 years, so it is important to repay on time, every time to avoid bad credit.

    2. Regularly obtain a copy of your credit file – once a year is recommended and this is free in Australia annually.

    3. Keep credit card limits within a set budget. Don’t be tempted to accept the sky high limits some banks offer as it could encourage you to spend needlessly and blow out your budget. A lower credit limit is also better when lenders are assessing your ability to repay a loan.

    5. Be aware of excessive credit enquiries. If you are not sure about your credit health, get it checked before applying for new credit so as not to rack up unnecessary credit enquiries. You do not record a credit enquiry when you enquire about your own credit file. Also, ensure you do not apply for credit all over town – and beware of filling any forms out online.  You should only apply for credit you have full intention of pursuing. Every application for credit will be noted on your file, but it does not say whether the application was approved or declined. It could look to creditors like you have been declined multiple times.Too many credit applications on a person’s file can hinder their chances of obtaining a loan. Some lenders are rejecting loans for as little as two enquiries in 30 days, or six enquiries within the year.

    For help repairing your bad credit, contact MyCRA Credit Rating Repairs today 1300 667 218 or see more information here:

     

    Image: annakml/ www.FreeDigitalPhotos.net

  • More Australians under financial pressure and less to use credit for luxuries says D&B

    Despite a 20-year high in household savings, Dun & Bradstreet’s latest Consumer Credit Expectations Survey reveals more Australians are worried about their financial futures. Those that can are tightening their belts by saving and not spending. But significant portions of the community who are unable to do so, are reaching crisis point. Could we see the rate of defaults rise among these groups as people struggle to keep their heads above water?

    By Graham Doessel, Founder and CEO of MyCRA Credit Rating Repairs and www.fixmybadcredit.com.au.

    Credit reporting agency Dun & Bradstreet’s (D & B) Consumer Credit Expectations Survey September 2012 was released a couple of days ago. D & B conduct a national survey each quarter on expectations for savings, credit usage, spending and debt.

    The latest survey shows a lack of personal savings has six in ten Australians concerned about their current financial situation, with one in three indicating they would be unable to cover basic expenses for longer than a few weeks if faced with a sudden job loss.

    The report seems to show that those that can save are, and those that can’t are reaching crisis point. Likewise with credit – those that are in a stable financial situation are skimping on credit for luxuries, whilst the numbers of low income earners relying on credit just to get by are significant amongst low income households.

    Let’s look at the figures from the survey as they relate to 3 Australian expectations on household savings and stability, credit access and ability to meet credit commitments for this coming September quarter:

    Household Savings and Stability

    The survey found that a third of low-income earners and a quarter of older Australians would only be able to survive for up to one month without a steady income.

    Sixty-nine per cent of those earning less than $50,000 annually and 62 per cent of consumers aged 50-64 are worried about their personal financial health.

    In addition, one in four low-income households and one in five older Australians admit to having no savings, despite a substantial portion (close to one third) indicating that current economic conditions are refocusing their attention towards saving.

    According to Dun & Bradstreet Director, Adam Siddique, some vulnerable demographics are facing significant financial pressures.

    “Our latest research clearly demonstrates that consumers are worried about their financial position.

    “This is partly symptomatic of lingering pessimism from the global financial crisis however, for certain demographics it reflects the reality that households are living hand-to-mouth; with very little savings buffer should unforeseen circumstances occur. So while national household savings levels are at a 20-year high, it is clear that not all consumers are in a position to put money aside,” said Mr Siddique.

    “For the older demographic, concern over finances in part reflects the ongoing fallout from the global financial crisis and its impact on superannuation.”

    Projections for credit access

    More than half of all consumers (53%) will be less likely to spend money on entertainment or other non-essentials this year than 12 months ago.

    Likewise, 40 per cent of consumers are less inclined to use existing credit to buy non-essential items, a figure which rises to 48 per cent for low-income households.

    Expectations for new credit access has also fallen, down five percentage points to just 15 per cent since the March quarter.

    “Ten to 15 years ago consumers were more comfortable living with a lower savings to debt ratio. However, continued global economic uncertainty is weighing on Australian households and dissuading discretionary spending, credit usage and significant investments such as buying a property,” said Mr Siddique.

    Ability to Meet Credit commitments

    40 per cent of low-income households expect to rely on existing credit sources to cover costs – the same demographic also anticipates difficulty meeting current credit commitments.

    Whilst this figure is still too high, the number has actually reduced from expectations in the June quarter, which found nearly half (46%) of all low-income households expect difficulty managing their debt.

    Low-income earners are similarly expecting rising debt levels; 34 per cent compared with 24 per cent of middle-income earners.

    Amongst older Australians, 28 per cent of 50-64 year-olds expect they will need to rely on credit to cover expenses, while 41 per cent anticipate difficulty meeting existing credit obligations.

    Reliance on credit among older Australians comes as one third of consumers aged 50-64 anticipate rising household debt in the coming months, up from 26 per cent during the March quarter.

    The evidence showing older Australians experience difficulty with credit was echoed by Veda Advantage recently. We blogged about seniors (over 65’s) struggling with credit in our post Default rates soar in over 65’s. Veda’s study on generational trends for credit activity showed this age group have become more reliant on credit which has led to the increased level of defaults as some struggle to meet financial obligations.

    Solutions to financial concerns

    If people bury their heads in the sand about their finances, they can invariably end up with debt and with bad credit history.

    This bad credit can send them into a debt spiral for years to come. Bad credit sticks for 5 to 7 years, so people are banned from mainstream credit at normal interest rates and are forced into payday loans, fringe credit and the non-conforming market, all of which charge significantly higher interest rates for the increased ‘risk’ of lending to someone with a history of poor repayment.

    Rather than allow this to happen, people should put their hands up early, as there are many avenues for help out there today.

    ASIC’s Money Smart website is the best place to start to get some FREE tips on how to make the most of money, get out of debt or squirrel away for a rainy day.

    They also link to a list of free or low-cost financial counsellors who can actively help with budgeting, managing debt and financial difficulties.

    For people who are having trouble with repayments, aside from seeking financial counselling, TALK TO THE CREDITOR.

    Creditors are generally willing to assist people experiencing genuine financial hardship, but they need to be specifically informed of the financial hardship prior to bills going overdue or to default stage.

    ASIC has also put together a factsheet titled Can’t Pay Your Debts? which outlines the process of requesting financial hardship from your Creditor, and other financial solutions.

    People should act as early as possible on financial problems, and look for ways of realigning finances so they avoid defaulting on any payments.

    For those people who may not be struggling with their finances, but are in the 6 out of 10 Australians who are concerned about their current financial situation and want to get savvy with their money – Money Smart can also help, or perhaps Australian savings websites such as http://www.savingsguide.com.au or http://www.simplesavings.com.au/ can offer some motivation and encouragement.

    Image: Nutdanai Apikhomboonwaroot: www.FreeDigitalPhotos.net

    Image: digitalart: www.FreeDigitalPhotos.net

    For help with repairing bad credit history that is affecting your financial future, contact MyCRA Credit Rating Repairs for assessment of suitability for credit repair.

  • Beware banks last-ditch attempts to raise credit limits

    As of July 1, the Government has banned unsolicited offers to raise people’s credit limits. So no longer will people receive offers in the mail from their bank or finance company to increase the limit on their credit card or other lines of credit. This change is part of the Government’s move to ‘responsible lending’, which also encompasses a whole host of new credit and credit reporting laws. But reports are out that some lenders are attempting to offset the deadline with a host of offers that people should be wary of. Before July 1, people need to remember their own limits when it comes to finance, to avoid debt and inevitably, bad credit history.

    By Graham Doessel, Founder and CEO of MyCRA Credit Rating Repairs and www.fixmybadcredit.com.au.

    Recently the ABC’s 7:30 Report featured a story titled Credit card changes bring borrower warning. It interviewed industry spokespeople including Australian Securities and Investments Commission’s (ASIC) Peter Kell:

    “Unfortunately ASIC has seen some of the major lenders, some of the major banks, in fact, looking at the opportunity of the introduction of these new laws to push credit onto their customer base in a way that’s inappropriate, and in a way that arguably undermines the intent of the new laws,” Mr Kell says.

    “The Commonwealth Bank recently posted a notice on their website telling customers they would “lose the chance to get credit limit offers under the new laws, and miss out on the opportunity to access extra funds,” ABC’s Stephen Long reports.

    “CBA gave a court-enforceable undertaking to stop the deception, but the damage was done,” Long says. He reports there were around 100,000 responses to the advertisement.

    The Australian Bankers Association’s Steven Munchenberg has defended the actions of the CBA as more a ‘different interpretation’ of new legislation than an attempt to head off the new laws :

    “Look, we are very, very closely regulated industry, and ASIC is doing its job by monitoring very carefully what the banks do. There are times where the banks and ASIC will interpret legislation differently, and these are new laws. What we are learning is the approach that ASIC is going to take, and the banks will be very quick to make sure they’re compliant with ASIC’s approach,” Munchenberg says.

    So in other words, the banks will see what they can get away with, until ASIC raps them over the knuckles for it.

    In the meantime, there are people who as Consumer Action Law Centre’s Catriona Lowe says, assume because the bank has offered them extra credit they must have been assessed as being suitable to make the repayments.

    “We have seen and done research about the way in which these offers have been put together, which really encouraged people to turn off, if you like, that hard-nosed financial part of their brain, and turn on the fuzzy, “Oh yes, I deserve it, I might need it for a rainy day, the bank manager’s telling me it’s OK, I’ll just do it without thinking about it too much,” Ms Lowe says.

    The ABC also reports that both Ms Lowe and Financial Counsellor Gary Rothman have seen a huge surge in offers of additional credit ahead of the start of the new responsible lending laws next month.

    “It’s not uncommon for us to see people with $70,000 to 120,000 in credit card debt,” Mr Rothman says.

    This report took me back to a blog post from a while back, on the notion of Affluenza. The post, titled Caught Affluenza? How it can affect your credit rating health explores the rampant notion of MORE. That we need more money, more things, and often more than we really afford.

    This social disease was coined by Clive Hamilton and Richard Deniss in their book Affluenza: When Too Much Is Never Enough.

    “Affluenza pulls no punches, claiming our whole society is addicted to overconsumption. It tracks how much Australians overwork, the growing mountains of stuff we throw out, the drugs we take to ‘self-medicate’ and the real meaning of ‘choice’. Fortunately there is a cure. More and more Australians are deciding to ignore the advertisers, reduce their consumer spending and recapture their time for the things that really matter.”

    Basically the philosophy is we shouldn’t spend money we don’t have, on things we don’t need, and ultimately find ourselves with what we don’t want – debt, unhappiness and bad credit history.

    Don’t get me wrong – I don’t advocate total credit shut-down. It isn’t very practical. Credit is necessary in today’s society. But people should use it to enhance their lives so that they can spend time with the ones they love, or to really improve their quality of life. Essentially people should make credit work for them.

    I see different types of people seeking credit repair. I see many people who are perfectly capable of repaying credit, but are banned from obtaining it due to errors and inconsistencies from Creditors which lead to negative listings on their credit file. We do our darndest to help remove those from their credit reports and let people have that financial freedom back again.

    But I do see a few people who have caught ‘Affluenza’, who maybe should learn the the doctrine of ‘enough’ through being banned from credit for a while.  In the same token, those people need society’s support. They need laws like the ones coming through on July 1 to curb that susceptibility to offers of more, BEFORE they end up with bad credit history. They need the Creditors – so quick to issue more, and then so quick to issue defaults reined in and checked.

    That consumer shift to spending reduction and savings should be embraced by banks. New laws which seek to follow and help this psychic shift in society should not have been exploited by our banks or other Creditors in the last weeks prior to their introduction.

    A bad credit rating can completely change our financial situation. The black marks like defaults or Clearouts placed there by creditors show up on our credit file for between 5 and 7 years. Bad credit can limit our choices and can perpetuate the debt cycle by leading us to choose loans with higher interest rates and more fees, so the struggle to make repayments can be even harder. People should think hard about their ability to repay any credit, whatever the circumstances to avoid this situation. But if you have bad credit history which for some reason should not be there, which is stopping you from obtaining credit that you can repay, you would be a candidate for credit repair. Contact MyCRA Credit Rating Repairs on 1300 667 218 to talk to us about how we can help you recover your ability to obtain credit and give you back your financial freedom.

    Top Image: adamr/ www.FreeDigitalPhotos.net

  • Experts say getting hooked by Australian Paypal or Amex phishing scams could result in identity theft

    Security experts warn of the potential severity of falling for phishing scams, claiming the data pilfered from these scams can not only result in financial loss, but in stolen personal information. This loss of financial data and or personal information can lead to identity theft and ultimately a whole heap of bad credit history for the victim. We have featured this topic in aid of National Cyber Security Awareness Week 2012.

    By Graham Doessel, Founder and CEO of MyCRA Credit Rating Repairs and www.fixmybadcredit.com.au.

    Tech publication, Computerworld warned readers this week of the growing threat of very clever phishing scams currently out there, threatening the personal information of PayPal Australia and American Express Australia customers. The four-month email phishing campaign has been targeting those customers with legitimate looking emails and one click could leave them vulnerable to identity theft. The article, PayPal, Amex phishing: What you need to know reveals some advice from top security experts on what this could mean for consumers. But before we delve into what the experts say, let’s look clarify how phishing scams work.

    The ins and outs of phishing scams

    Phishing scams are generally emails or text messages which impersonate genuine companies in the hope of tricking victims into giving out their personal and financial information. They can appear to come from banks, big companies and in the most recent cases, PayPal and Amex.

    The aim of phishing is to steal information like bank and credit account numbers, passwords, and other crucial personal data.

    The ACCC’s Scamwatch website warns that phishing emails are not easily distinguishable from genuine corporate communication:

    “Phishing emails often look genuine and use what look to be genuine internet addresses—in fact, they often copy an institution’s logo and message format, which is very easy to do. It is also common for phishing messages to contain links to websites that are convincing fakes of real companies’ home pages.

    The website that the scammer’s email links to will have an address (URL) that is similar to but not the same as a real bank’s or financial institution’s site. For example, if the genuine site is at ‘www.realbank.com.au’, the scammer may use an address like ‘www.realbank.com.au.log107.biz’ or ‘www.phoneybank.com/realbank.com.au/login’.”

    What happens if people fall for a phishing scam?

    In the Computerworld article, Doctor Jon Oliver, Trend Micro Australia global threat researcher warns that phishing scams were designed to infect computers through virus-containing links in the emails.

    “If a user gets infected then they may suffer direct economic loss because the malicious payload of these phishing-like schemes is to infect the user with financial Trojans and information stealers,”…

    Aside from potentially gaining access to credit card details, Oliver said the BlackHole exploit kit spam runs were infecting users with malware, leaving the users and companies open to ongoing damage until the systems were cleaned or re-imaged…

    “The types of damage can include stolen usernames / passwords, fake anti-virus attacks or data theft,” Mr Oliver said.

    The article also features warnings from IDC Australia senior market analyst , Vern Hue. He said that companies needed to be extra vigilant with security as the emails could prove to be an opportunity for cyber-criminals to deceive people into believing that emails and other communications came from a legitimate source.

    “However, once they click on a link, users will then be transported into a link that is hosted by malicious actors for the purpose of either stealing information, installing malware or duping users to part with their money,” Hue said.

    “We need to be cognisant of the fact that cyber-criminal are crafting very authentic looking email communications.”

    He recommended that organisations put in place formal business communication policies and guidelines around acceptable use of social media and financial services.

    So aside from potentially having credit card details stolen, these scams can invade all the personal data on a person’s computer. What would such a virus find on most computers? Probably a whole lot of personal and financial information – enough for a clever and determined cybercrook to go about stealing the victim’s identity. A fake identity means fraudsters have access to their victim’s good name through their credit rating, and it means the victim has a whole host of difficulties in recovering their ability to obtain credit.

    Vigilance against phishing scams

    The Scamwatch website provides these tips for steering clear of phishing scams:

    • NEVER send money or give credit card or online account details to anyone you do not know and trust.
    • Do not give out your personal, credit card or online account details over the phone unless you made the call and  know that the phone number came from a trusted source.
    • Do not open suspicious or unsolicited emails (spam)—ignore them. You can report spam to Australian  Communications and Media Authority. If you do not wish to report the message, delete it.
    • Do not click on any links in a spam email or open any files attached to them.
    • Never call a telephone number that you see in a spam email or SMS.
    • If you want to access an internet account website, use a bookmarked link or type the address in yourself—NEVER  follow a link in an email.
    • Check the website address carefully. Scammers often set up fake websites with very similar addresses.
    • Never enter your personal, credit card or online account information on a website if you are not certain it is genuine.
    • Never send your personal, credit card or online account details through an email

    For help with recovering a damaged credit rating following identity theft, contact MyCRA Credit Rating Repairs directly on 1300 667 218 or visit the main website www.mycra.com.au.

    Image above: David Castillo Dominici/ www.FreeDigitalPhotos.net

     

     

  • More Aussies struggling with less people candidates for mainstream credit

    A recent survey shows the number of Aussies struggling to meet their credit commitments is increasing. Will late payment notations to be included on credit files as part of the new credit laws prevent this figure from continuing to increase in the future?

    By Graham Doessel, Founder and CEO of MyCRA Credit Rating Repairs and www.fixmybadcredit.com.au.

    Results from Veda Advantage’s bi-annual Australian debt study late last month showed more and more Australians are at risk of falling into a debt spiral during an economic downturn.

    Findings show that 21% of Australians are struggling to pay their current credit commitments. Despite this, a quarter also admitted they will apply for yet more credit to help them cope with an economic downturn.

    Veda’s analysis of consumer behaviours if there is a period of economic stress shows:

    • Most (66%) Australians would draw on household savings;
    • One in four (25%) would increase their credit card limit, mortgage or loan;
    • One in three, or almost 5.5 million, would borrow from family;
    • Over 3.6 million (21%) would draw on their superannuation.

    Veda claims the introduction of late payment notations to credit files as part of comprehensive credit reporting should prevent more people from falling into a debt spiral.

    Veda’s Matthew Strassburg says “…the changes to credit reporting will make credit reports fairer and more accurate for consumers looking to borrow. The new information will include a person’s current credit limit, number of credit cards and if someone has failed to make the minimum payment on a credit card or loan on time.”

    I agree, accuracy in credit reporting in Australia is paramount. Late payment notations would certainly see less people given access to mainstream credit. But the question is – how fair will this system be?

    25% of people surveyed by Veda said they would increase their credit card limit, mortgage or loan if they fell into ‘economic stress.’ But Veda fails to mention the definition of ‘economic stress.’ Possibly if the stress was certain to be temporary – some people would nominate increasing their credit limit or redrawing on their mortgage as a possible short term solution to ride out the bad period. It is not certain from the results published how many people surveyed would actually choose more credit – especially new loans as a solution to a long term financial problem.

    If some of those 25% who nominated ‘more credit’ as a solution intended to use credit for an extended period of economic stress, then certainly the introduction of late payments as part of comprehensive credit reporting would stop some in their tracks from gaining more credit – and rightly so, there are better solutions to debt stress than more debt.

    But what if the issue is a temporary one? How can mainstream lenders truly tell if someone is a bad credit risk if they have been late making one payment? At least with a default recorded – it shows the credit file holder had been at least 60 days in arrears with their repayments.

    There are so many grey areas with the introduction of these new laws, and I am nervous that more consumers than necessary could suffer a reduction in access to mainstream credit. Could more be forced to access the non-conforming market at high interest rates as an alternative? Doesn’t this further perpetuate the debt cycle and lead even more people to experience financial stress?

    One important point the Veda survey highlighted was the lack of impetus to seek help if people did fall under economic stress. It is important that people know that they can seek help if they are falling into difficulty making repayments – or they feel they may in the future.

    Veda’s analysis indicates that despite 21% of the population saying they are having difficulty coping or are unsure how they will make the next payment, only one in five had sought professional financial counselling.

    Mr Strassberg added: “People having trouble repaying should seek help from a financial professional before it’s too late, particularly lower income earners with competing debt repayments.”

    Certainly financial counselling, possibly seeking a financial hardship variation, and generally contacting a creditor prior to letting a repayment fall into arrears or into default is always the better option to avoid debt stress and bad credit history.

    If you or someone you know has bad credit history which shouldn’t be there – contacting a professional credit rating repairer can help you get your life back on track and potentially remove credit rating errors permanently.

    Image: Stuart Miles FreeDigitalPhotos.net