MyCRA Specialist Credit Repair Lawyers

Tag: clear-outs

  • Found your special someone this Valentine’s Day? 7 tips for joining finances

    Valentine's DayHappy Valentine’s Day to all the lovers out there!  If you are one of the lucky ones that has found that right person for you, then you may be looking at joining finances – perhaps moving in together, or taking the plunge and buying a home together. Before you do, read my 10 tips to protect your credit file when you are joining finances. Unfortunately love isn’t enough to ensure our ideas about money are always going to match up. If they don’t – make sure your credit file – your good name stays intact – even if the relationship doesn’t.

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

    1. Take off the rose-coloured glasses.

    Yes, cupid may have got you good. This may be the best person you’ve ever known. But that doesn’t mean they are perfect. No, really it doesn’t! Being in love and in particular new love can be the best feeling in the world. But let’s be honest, it’s not the most practical of states to be in. Sometimes our standards go out the window and we lose ourselves in the process of adding to our ‘relationship’ and creating an ‘us’. Before you join your finances, take off the rose-coloured glasses for just a minute, and put some real thought into how you are going to make the financial relationship work. With Relationships Australia identifying conflict over money as one of the top causes of arguments and relationship breakdowns in Australia, it makes sense doesn’t it?

    2. What’s their history?

    People will do what they’ve always done. You need to know of any skeletons in their closet that may impact your relationship and your credit file. Have a frank and open discussion about the financial decisions you’ve both made in your past.

    If you are joining finances, perhaps entering a mortgage, or even just moving in together and putting the Electricity and Gas on, effectively what you are doing is joining credit history. You need to know if their credit history up till now is clear.

    It might be worth getting a copy of each other’s credit files (you can request a free copy of your credit file and a report will be mailed to you within 10 working days). If there are adverse listings, they will impact your ability to obtain credit together for between 5 and 7 years depending on the listing type. If something on either credit file is amiss or incorrect – it is probably a good time to look at disputing it. Credit listings such as defaults, Judgments, Writs or Clear-Outs can all be removed if it can be proven that the listing was placed unlawfully.

    3. What’s their money mindset?

    Knowing their credit history should give you a good indication of how your prospective partner views money. So will knowing what debts they currently have. It will give you an indication of how they feel about money, and how much debt they consider normal to handle. You can also talk about paying bills. Do they always pay them on time? If not, why not?

    Some of us are great with money and some of us aren’t. If one of each money type get together the potential for both people to be financially damaged is greatly increased. As credit rating repairers, every day we meet people who need help with fixing credit rating issues due to no fault of their own really, but they have fallen under the financial shortcomings of a partner.

    One partner can end up with a bad credit score, simply because the other person on the account has not made repayments to the account. Often people are unaware their partner is generating defaults on their credit rating until it is too late. They apply for credit in their own right and are unable to proceed due to debts and bad credit their partner has initiated. The relationship may even have ended years ago.

    4. Do your financial goals match?

    Does one of you envision you both quitting your jobs in a couple of years to go travelling while the other has been saving for their own home? Is one’s greatest goal to pay back the 3 credit cards they’ve maxed out, while the other has plans to be debt free by the age of 40? If you establish some differences in what you want out of life, talk about whether there can be a compromise. You must identify how important each goal is and decide whether you really should be entering into a financial relationship at this stage. If your differences financially are too great – perhaps you can work out a way to still be together, but keep your finances (and credit files) separate unless your goals change.

    5. Identify needs and wants.

    If you decide you want the same things out of life, it might be a good idea to agree on financial priorities, so you don’t blow out all of your good intentions buying things you don’t really need. This could reduce your fights about money and ensure you’re both really on the same page. For instance, if you decide the most important thing is to save for your own home – you can agree that the new car, the expensive dinners and the designer wardrobe are only wants and can be put off until you reach your ultimate goal.

    6. Make a joint money plan.

    It may be a good idea to make a budget plan for you both to stick to, particularly if you have made a big credit purchase like a mortgage, car or business loan. There are a number of great free websites – ASIC’s Money Smart Website is a good place to start. You can decide who is paying bills, how they are going to be paid on time, where the money is coming from, how you are going to save and what money you will have left over for luxuries. If you don’t end up being the person in charge of paying bills – that doesn’t mean you can bury your head in the sand about your finances. Check the accounts every now and then. If there are any problems or your partner has missed payments – you’ll both want to know about it before your credit file is defaulted.

    7. Leave emotion out of it.

    During your financial relationship, things can go wrong – arguments can still occur despite your best efforts to prevent them. When it comes to money, agree for your disagreements to remain business-like. That way you can always keep a dialogue about money and there are no heated emotions attached to your discussions.

    Likewise, if the relationship should turn sour you are still able to separate love and money. There may be less likelihood of post-relationship revenge purchases impacting your credit file. If you do break up and you have joint credit, notify your Creditors that you are no longer together. Make sure you both get separate statements and endeavour to separate credit files (by dissolving joint credit) as quickly as possible in order to keep control over your own credit history and keep your credit file clear.

    If you haven’t been lucky in love, and your partner has left you with a bad credit rating, MyCRA Credit Rating Repair may be able to help. Contact a Credit Repair Advisor on 1300 667 218 for more information and to determine whether you may be suitable for credit repair.

    Image: anekoho/ www.FreeDigitalPhotos.net

    Image 2: photostock/ www.FreeDigitalPhotos.net

  • 5 things every young person needs to know about credit

    It’s back to school for most teenagers in Australia. Here is a lesson you might not learn there…Just because you currently aren’t credit active, does not mean you can’t learn about how to make credit work best for you when you are. We show you how the actions you take NOW could lead to being unable to get a phone, a home, a car in the future because of a surprise bad credit rating.

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

    We believe this important financial information should be taught in high schools across the country. So if you know a student or young adult, flick them this link or print this page. We want all young Australians to have the luxury of a clear credit rating when they turn 18 and beyond.

    1. What is a credit rating?

    Once you turn 18, and become ‘credit active’, a credit file is initiated in your name. This contains all financial information on you, including any credit you have taken out, the amount of credit, and any negative listings – like court Judgments, writs, bankruptcies, clear outs, and defaults. A default occurs when an account has not been paid more than 60 days, and the creditor (bank, telephone company, electricity company etc) places a record of this ‘default’ on your credit file to alert future creditors. A clear out is when the creditors are unable to get hold of you over late payments, agents have been sent to your house and they record this as a ‘clear out’. By accessing your credit file, a potential creditor can assess your credit rating, based on any negative listings which are present there.

    2. What happens to me if my credit file has negative listings on it?

    Generally, a negative listing on your credit file tells banks or other people you might want to borrow money or services from, that you have had problems repaying credit in the past. They will most often decide that you are a bad ‘risk’ to lend money to, and will refuse you the car, money, credit card, electricity account or mobile phone plan.

    A negative listing stays on your credit file for 5-7 years, depending on the listing and ‘drops off’ after this time. A negative listing will affect you for the entire time it is present on your credit file. You need to ask yourself: what do I want to be doing in 5 years????

    3. How do I end up with a negative listing on my credit file?

    It is estimated there are approximately 3.47 million Australians with negative entries on their credit file. (Veda Advantage 2008).
    The most common negative listing is a default. This is put there when you don’t pay your bills on time.
    But there are other reasons why you could have a negative listing, which are not always completely your fault.

    Change of address. Sometimes people move and their mail continues to be sent to the old address. This is a really common scenario, particularly for young people who tend to move around a lot, or go overseas. The problem is – you don’t know your bills are late and don’t know you are being defaulted. It is important to update contact information regularly with anyone you have taken credit out with. No news is not good news!!!

    Identity theft. Sometimes people’s personal information can be used for purposes of fraud – for crooks to construct a fake identity, and use it to take out credit. The thing is, they are using your name so you are the one that ends up with the bad credit rating, and it can be a nightmare to recover the good credit rating you once had.

    It is important to keep all your personal information as secure as possible. One important change you can make right now, is to change the way you use the internet.

    Keep your passwords and social networking settings as strong as possible.

    The information you post today, could come back to haunt you in a big way.

    There are reports from Australian Federal Police of the likelihood of crooks scrolling through thousands of social networking pages looking for personal information from young people – who usually have the most lax privacy settings. That information is not used right away, but the data is ‘warehoused’ until the young people turn 18. They can then use that information to construct a fake identity (identity theft) and go on a ‘spending spree’ with the young person’s clean credit file. You could be ruined by identity theft before you even take out your first piece of credit yourself.

    Share accommodation. Any accounts which have your name on them, regardless of who intends to pay them are your responsibility – this includes rent. Sometimes people get caught out sharing houses, and someone leaves bills unpaid which then have dire consequences for your future.

    Mistakes. Sometimes mistakes happen. The wrong person gets the bad credit rating. The wrong details get put in the computer. Creditors are human. Don’t let a mistake affect your credit file.

    Too many credit enquiries. Only apply for credit you feel you have a very good chance of being approved for, and only apply for credit you have full intention of pursuing. Sometimes too many credit queries are enough to get you declined for credit.

    4. How do I know what is said about me on my credit file?

    Many people don’t know this, but it is so important for everyone to keep track of the accuracy of your own credit file. To avoid the disappointment and embarrassment of finding out about your bad credit rating only after being declined credit, we recommend you check your credit file every 12 months to ensure there are no black marks against your name, just as you would check your bank statements or your super account.

    You can request a copy of your credit file for free from the major credit reporting agencies – Veda Advantage, Dun & Bradstreet, or Tasmanian Collection Services (if you are Tasmanian). Your credit report will be provided within 10 working days – or for a fee it can be provided urgently.

    5. What do I do if something is not right – there are errors on my credit report?

    Don’t put up with any errors or inconsistencies on your credit report – a clear credit rating is your ticket to financial freedom.

    Most times a credit reporting agency will tell you that defaults are never removed, but can be marked as paid. You are then stuck with a dodgy credit rating for 5 years. But you shouldn’t have to put up with it, as it is possible to have many defaults removed.

    If there are errors, inconsistencies, or the listing should not be there, you do have the right to have it removed. The best course of action is to ask for help from a credit rating repairer. They can then use their knowledge of credit reporting legislation to see where any errors in credit reporting were made, and help to enforce the legislation that creditors are bound to comply with. If they are successful, you not only get help with removing credit file errors, but many times you are able to start off with a completely clean credit rating. You have a clean slate and can go for any credit you need.

    For more information contact MyCRA Credit Repairs tollfree on 1300 667 218 or visit the main website.

    Image: imagerymajestic / Freedigitalphotos.net

    Image: David Castillo Dominici / Freedigitalphotos.net

  • 7 ways to improve your credit rating in Australia

    There are countless pieces of advice available to people out there, aimed at offering to ‘improve your credit rating’ or ‘fix your credit score’, and they are read by many people hoping to get the best chance of approval for home loans, personal loans or other forms of credit.

    What many Australians don’t realise when they read these articles is that many of them are written in countries like the U.S. and U.K., whose credit reporting systems are very different from Australia’s. So the information, whilst good, often doesn’t apply for people in this country.

    In fact, many times if Australians follow that information they may actually be hindering their chances of obtaining credit in the current market, not helping it.
    So here is some information for people concerned about their credit rating, to have as a reference for what applies in this country.

    What exactly is my credit file?

    A credit file is made for every person who is credit active in Australia. Veda Advantage, Dun & Bradstreet, Tasmanian Collection Service (if Tasmanian) and new entrant Experian may all hold information on credit active individuals.

    A person’s credit file contains their personal information. It also records any credit applications, all loans which are current and also records any adverse listings such as Defaults, Writs, Judgments, Clear-outs or Bankruptcies which are under that person’s name.

    It is from this file that creditors make a decision whether or not to lend people money. This information is then available to banks and building societies; finance companies like GE and Avco; mobile phone companies and retail stores like Myer, Harvey Norman and Wow Sight & Sound.  These companies are all known as credit providers or creditors.

    What many people aren’t aware of is that any creditor may place an adverse listing on a person’s credit file if the account has remained unpaid past 60 days. This includes phone companies, utility companies, and gyms as well as banks, finance companies and stores – and the outstanding amount can be for as little as $100.

    A negative credit reporting system

    Currently Australian credit reporting system is a ‘negative’ system. This will change as Australia moves towards positive credit reporting, but until then – the rules of the game are very different from many other countries. Only negative data is recorded on a person’s credit file. From this point of view – there is nothing people can do to counter-balance any negative data which is displayed on their credit file. It is either present – or not.

    So is there anything I can do to change my bad credit rating?

    YES AND NO! There is no ‘score’ as such in Australia. So a person’s credit file is what it is with all adverse listings displayed for creditors to consider, and no amount of ‘positive’ credit information can currently change that. Under Australia’s credit reporting laws these adverse listings have a set time frame they must be listed for. This is 5-7 years depending on the type of listing. Unfortunately most adverse listings guarantee automatic decline on credit approval in the current market. Adverse listings are not removed ahead of time, but a creditor will mark the listing as paid if the account has been settled.

    However, if a person’s credit rating contains listings which should not be there, or there are errors, the credit file holder does have the right to have this information rectified.

    5 ways to improve your chances of obtaining credit under Australia’s credit reporting system:

    1. Reduce credit limits.

    Lofty credit limits do not improve a person’s credit ‘rating’. If the loan applicant has a credit limit of say $20,000 on their credit card, the debt amount on that card will be calculated on $20,000 – even if the actual amount the applicant has owing on that card is only $5,000. So a potential borrower should seek to reduce any credit limits on cards or loans they currently hold.

    2. Reduce credit enquiries.

    Do not shop around for credit. Whenever a person other than the credit file holder makes an enquiry on their credit record – that enquiry is recorded on the person’s credit file. Currently there is no way of seeing on someone’s credit report if the loan was approved or not, only that the application was made. Some lenders are refusing home loan applications due to too many credit enquiries, such as two enquiries within thirty days or six within the year.

    3. Check credit file.

    Anyone has the right to request a copy of their credit file, to see what is being said about them. This report is free for the credit file holder every 12 months. The request should be made to all the applicable credit reporting agencies, and a report will be made to the credit file holder within 10 working days.
    There is the potential for creditors to make mistakes when entering listings on credit files. So anyone who is credit active should check theirs, regardless of how diligent they think they may have been with their repayments.

    A small scale study conducted by the Australian Consumer Association (now Choice Magazine) in 2004, revealed a staggering 30% of credit files were likely to contain errors.

    “In our view, there are serious, systematic flaws which are leaving an increasing number of Australian consumers vulnerable to defamation, mis-matching and harassment,” the report said.

    Adverse listings can sometimes occur due to identity theft; some people are caught in issues over separation from their spouse; some have been disputing the bill which went to default stage and many people are just victims of the fallout from inadequate billing procedures – wrong names, wrong addresses errors with creditor computer systems, and sometimes human error.

    Many times people are unaware they have adverse listings on their file until they apply for credit and are refused. Unfortunately at that time it can be stressful, and they can lose the home, or be forced to choose a different loan with a higher interest rate.

    4. Pay any outstanding amounts.

    If a credit file check reveals outstanding amounts on a person’s credit file, paying them can be of benefit to a person’s credit rating. Whilst the creditor cannot remove the listing, they can mark the listing as paid, which in some cases could improve people’s chances of obtaining credit.

    5. Remove errors.

    Unfortunately listings are not removed by creditors unless the credit file holder can provide adequate reason and lots of evidence as to why the listing should not be there. Credit repair also requires knowledge of the legislation and perseverance. But for those people whose financial freedom is hindered because their credit file contains errors, it is a point worth fighting for.

    If people have neither the time, knowledge or patience for credit repair they can seek out a reputable credit repairer who will be able to work on their behalf to negotiate with creditors to have the defaults removed if there are errors.

    A clear credit record can allow potential borrowers the option to choose the best loan to suit them, with the best interest rate.

    6. Make repayments on time.

    Repay any bills received by the due date. Repay over the minimum amount required on credit cards. If people are having trouble paying on time, they should contact the creditor as they may be able to work out a payment plan rather than listing the non-payment as a default. If people are disputing bills with creditors, they should still pay the bill by the due date. Better to be reimbursed the outstanding amount than have the creditor put a default on their credit file in the process.

    7. Show stability.

    Having a stable address, stable income and stable employment can all improve someone’s chances of obtaining credit. Right before someone applies for a home loan is not the time to change jobs – regardless of how good the wages are.

    Interestingly, many errors in credit reporting occur when people change addresses, so keeping a stable address can also decrease the likelihood of bills going to the wrong address and defaults being placed on a person’s credit file unnecessarily.
    People can visit the MyCRA Credit Repairs website for more help with their credit rating, and help to repair a bad credit rating.

    Image: vichie81 / FreeDigitalPhotos.net

  • Caught affluenza? How it can affect your credit rating health

    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.

    The Wikipedia explanation of affluenza refers to it as “a painful, contagious, socially transmitted condition of overload, debt, anxiety and waste resulting from the dogged pursuit of more.”

    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.

    Recently Fran Sidoti from SavingsGuide.com.au posted an interesting article about this topic titled Affluenza, And What It Might Mean For You. She says it starts by wanting a big house, and then all of those things that go in it, and with it – but that when we have everything, we are still not happy. She suggests we take a step back and employ old-fashioned values like “building a strong family, especially with an awareness of role models like grandparents who wouldn’t recognise affluenza if it bit them. A respect for hard work and the money it earns is crucial, as is emphasis on philanthropy and charity.”

    Australians Clive Hamilton and Richard Denniss’ book, Affluenza: When Too Much is Never Enough, poses the question, “If the economy has been doing so well, why are we not becoming happier?”

    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.

    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.”

    How many of us know someone who has gotten really sick – so sick that they lose everything – the house, the car, the job. If they are lucky enough to survive it, they always seem to have this new-found view of money. They often make that life changing decision to cut back on all those material things. They say they appreciate that the real joy in this world comes from spending time with family and friends and also dedicating some time to themselves.

    A new perspective on credit

    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.

    How healthy are we looking?

    It is perfectly okay to use credit, 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.

    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.

    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.

    A clean slate

    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.

    Visit MyCRA’s website www.mycra.com.au for more information on credit repair.

    Image: Salvatore Vuono/ FreeDigitalPhotos.net

    Image: photostock/FreeDigitalPhotos.net