MyCRA Specialist Credit Repair Lawyers

Tag: credit

  • 12 ways The LGBTQ+ Experience Financial Discrimination

    12 ways The LGBTQ+ Experience Financial Discrimination

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    The Top 12 Challenges LGBTQ+ People May Face When Trying to Get Credit
    & How The LGBTQ+ Experience Financial Discrimination

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    Getting credit is an essential part of financial stability and success. But for members of the LGBTQ+ community, securing credit can be a challenge due to a range of issues. In this blog post, we’ll explore the top 12 challenges that LGBTQ+ people may face when trying to get credit.

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    Discrimination: LGBTQ+ individuals may experience discrimination from financial institutions and lenders based on their sexual orientation, gender identity, or gender expression. This discrimination can result in unfair treatment and denial of credit.

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    Lack of Understanding: Many lenders and financial institutions lack an understanding of the unique financial needs of LGBTQ+ individuals, including same-sex couples and transgender individuals. This lack of understanding can lead to confusion and miscommunication during the credit application process.

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    Credit History Issues: LGBTQ+ individuals may face credit history issues, such as errors on credit reports, due to name changes, address changes, or other factors related to their gender identity.

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    Legal Issues: In some countries or states, same-sex marriage or partnership is not recognized, which can make it difficult for couples to obtain joint credit or loans.

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    Employment Discrimination: Employment discrimination against LGBTQ+ individuals can lead to financial instability, making it more challenging to obtain credit.

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    Family Rejection: Family rejection can lead to a lack of financial support and difficulty securing credit.

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    Lack of Legal Protections: In many countries, there are no legal protections against discrimination based on sexual orientation, gender identity, or gender expression, making it harder for LGBTQ+ individuals to fight back against discriminatory lending practices.

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    Transgender Discrimination: Transgender individuals may face additional challenges related to legal name changes, gender marker changes, and accessing appropriate credit products.

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    Heteronormativity: Many financial institutions and lenders assume heteronormative lifestyles, which can lead to difficulties for LGBTQ+ individuals in accessing credit products that are relevant to their needs.

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    Stereotyping: LGBTQ+ individuals may be stereotyped by lenders and financial institutions, leading to unfair treatment and denial of credit.

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    Lack of Support: LGBTQ+ individuals may not have access to the same support networks and resources as their heterosexual counterparts, making it more challenging to obtain credit.

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    Mental Health Issues: LGBTQ+ individuals may experience mental health issues related to discrimination and stigma, which can make it more challenging to manage finances and obtain credit.

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    At MyCRA Credit Repair Lawyers, we understand the unique challenges that LGBTQ+ individuals may face when trying to secure credit. Our team of experienced credit repair specialists can help you navigate the credit application process and advocate on your behalf to ensure that you’re treated fairly.

    If you’re struggling to secure credit due to any of the issues outlined in this blog post, we encourage you to book an assessment with us today. We’re here to help you achieve financial stability and success, no matter your gender identity, sexual orientation, or gender expression.

    While compiling this list, I had a few more that I’ll include here to promote and provoke thought and discussion.

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    Marital Status: Marriage equality is a relatively recent development in many countries, and lenders may not recognize same-sex marriages, leading to credit denials or complications.

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    Name changes: Transgender individuals may change their name, but may experience difficulty updating their credit history, leading to confusion or complications when applying for credit.

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    Bullying and harassment: LGBTQ+ individuals may experience bullying and harassment, leading to missed payments or financial struggles.

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    Fear of being outed: Some LGBTQ+ individuals may fear being outed if they apply for credit, leading to reluctance to apply for loans or credit cards.

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    These are some common issues faced by the LGBTQ+ community when trying to obtain credit, but each individual’s experience may be different. Other factors could also come into play, such as the country or state the person lives in, the specific lender they are dealing with, and the individual’s financial history and credit score.

    Disclaimer: The information provided in this article is for educational and informational purposes only. The LGBTQ+ community faces many unique challenges when it comes to accessing credit, and the issues discussed in this article are not meant to be an exhaustive list. It is important to seek professional advice when it comes to managing your credit, and we encourage you to consult with a qualified credit counselor or financial advisor, or more importantly for mortgage finance, your preferred Mortgage Broker who can help you navigate these issues. MyCRA Credit Repair Lawyers is not responsible for any errors or omissions, or for any actions taken based on the information provided in this article.

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  • Make a mortgage work for you: Taking a conservative approach to purchase price

    In this week’s ‘Make Credit Work for You’ we take a look at the biggest form of credit many consumers are likely to take out – finance on a home. Whilst a home loan is a unique form of credit in that it will generally appreciate over time, there are ways it can be an unsafe form of credit. We look at how you can minimise the risk to you and your credit file when you purchase your first home.

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

    In Australian Broker Magazine article FHBs urged to take caution when signing on to a home loan last week, a financial comparison website warned first home buyers they should be looking carefully at purchase price following research showing many are taking on more debt despite the relative stagnation of the housing market.

    Research by RateCity shows first home buyers are taking on more expensive mortgages on the back of steady growth in house prices over much of the past 15 years:

    According to the site, the national average first home buyer mortgage size almost doubled in the past decade, to $297,100 in January 2013 and FHBs are taking on almost three-times more debt than they were 15 years ago.

     If the average first home buyer loan size kept in line with inflation only over the past 15 years, RateCity estimates first time borrowers are taking on a further $133,869 (or 82%) above the inflation adjusted average loan size…

    Michelle Hutchison, spokesperson for RateCity, says that while there are good opportunities to enter the home loan market this year, FHBs need to be cautious about taking on too much debt.

    “Australia’s property market is looking positive for first home buyers with record low interest rates making home ownership more affordable and luring some buyers out of the woodwork. While prospective home buyers are starting to enter the property market, borrowers need to be careful about how much debt they can afford to take on.”

    If we figure that most home buyers are now falling into the category of Gen Y, Ms Hutchison’s statement is a wise one. Recent reports from credit reporting agency Veda Advantage show that Gen Y has the lion’s share of bad credit at 60% of all defaults. The most important thing for you as a first home buyer to do is to decide on a purchase price that suits your needs now, and in the future.

    We can ensure we don’t become part of those statistics and ensure the home is really affordable, by considering three things.

    1. Is this mortgage going to still allow me to live?

    Just scraping into a sky-high mortgage could be a detriment to your lifestyle and even your happiness. Do you have wiggle room between your repayments and your wages for savings or for lifestyle purchases? What if your income decreased slightly? Leaving a bit of room for emergencies and also just enjoying life can make all the difference and can mean the money you don’t use can go into extra repayments on your loan, and you can pay it off quicker. Having no room for incidentals will invariably mean if life throws a curve ball at you, you’ll be likely to end up in debt and with a default on your credit rating or worse – all because your purchase was too impulsive and just downright too much for you to handle.

    2. Can repayments be made with only one income?

    This is a big trap for couples – even if they don’t intend to have children in the near future. Accidents, sickness, break-ups and yes, children can put a strain on finances and can mean the mortgage is paid from only one income for a period of time. Can you cope with the mortgage if this happens?

    3. How much equity do I have in the home?

    This may seem like a trick question, as really first home buyers have very little equity when they first enter a mortgage – but the bigger the deposit in relation to your purchase price, the more equity you will have, and the more freedom you will have. Having equity will make changes such as refinancing easier, and if for any reason you need to sell the home, you will be less likely to be left with a debt.

    When we think about equity, we can also consider future equity. To capitalise on equity it may be best to have a good think about the area you are buying in in relation to your purchase price. Is this area likely to grow much over the next 5-10 years? Is the type of property I am buying likely to be sought after in the area? Is it close to the median house price for the area? For instance, you might be better to buy an apartment in an inner city area which is going to see significant growth rather than a four bedroom home in an outer suburb which is surrounded by cheaper properties. Or on the flipside, you may be better to buy a modest home in a suburb surrounded by expensive properties rather than a penthouse apartment which is flagged on all sides by basic 2 bedroom rentals. Real estate has a general rule, buy the worst house in the best street – but of course – if you can’t afford to do renovations – it would be a good idea not to buy the worst house if it needs lots of work!

    When making this decision on your financial future, do your homework. Buying a home should not be rushed. Research the area, research what you can afford to pay – and think of this decision like an investor would. After all, the stability of your finances and ultimately the credibility of your credit file rests with it.

    The government’s Money Smart website provides good advice on Buying a Home:

    How much can you afford?

    A good way to find out how much you can afford to spend on a property is to review your household budget. If you don’t already have one, use our budget planner to:

    • Take what you’ve saved as a deposit, add in first home buyer assistance (if applicable), then work out how much you can afford to borrow

    • Work out how much you can comfortably afford to repay on a home loan each month, and add a bit more to act as a buffer in case of interest rate rises

    • Include all the costs that come with home ownership: up-front costs like stamp duty and legal fees, ongoing costs like land and water rates, house and contents insurance, and repairs

    This article is intended to give ideas only for general information, and should not be taken as financial advice. We recommend you contact a reputable financial adviser about your unique situation to decide what is best for you.

    Image: ponsulak/ www.FreeDigitalPhotos.net

  • Businessman gives away $50m to Australian university students

    businessman gives away $50mFrom time to time I discuss the wider philosophies of finance with a view to helping to improve attitudes to money in Australia and with it our collective view of credit. Often I have said credit is not something that is given, it has to be earned. Well, today I came across the most amazing story of one highly successful Aussie entrepreneur who has chosen not to hand down his fortune to his kids, but to donate it. He believes in doing so he is giving a gift to not only 125 university students, but a gift to his own children. We look at this amazing story and how we might be able to apply these principles in our own lives:

    By Graham Doessel, Founder and CEO of MyCRA Credit Rating Repair and www.fixmybadcredit.com.au https://www.facebook.com/FixMyBadCredit.com.au

    Today the headline in the Daily Telegraph’s Business News was ‘Graham Tuckwell giving away $50m in largest donation to university students.’ I was gobsmacked – and of course read on.

    Australian National University (ANU) Economics and Law Alumnus Graham Tuckwell will pour a whopping $50 million into the education of strangers in the largest donation ever made to Australian university students.

    Twenty-five undergraduates will score scholarships worth up to $100,000 at Canberra’s ANU each over the next five years – creating 125 scholarships all up over that time – from Graham Tuckwell – one of the country’s most successful financial entrepreneurs.

    The scholarships are set to run in perpetuity over the next 20 years.

    Canberra-born Graham Tuckwell studied at ANU before his global successes led him to set up ETF Securities Limited, which issues exchange traded products and has about $30 billion in assets.

    His reasons for his extremely generous donations are two-fold:

    He told News Ltd he and his wife Louise wanted to change lives and did not think it was sensible for parents to give vast amounts of money to their own children.

    “Lots of money is poisonous to have,” he said.

    The second reason – is a hope to inspire other wealthy Australians to consider philanthropy rather than just passing their fortunes down.

    “Generally speaking, if you look at the people in Australia that have got huge amounts of wealth, without naming any, they generally have not put the majority of their wealth behind strong philanthropic causes,” he said.

    “And unfortunately in some cases they pass the wealth down to later generations who have behaved badly.

    While the pair will put their four children through university and help set them up, Mr Tuckwell said he just wanted them to do what made them happy.

    “And if they create things themselves, then it’s a sense of achievement,” he said.

    “Where as if you just give them stuff, it almost destroys their desire to do things and you actually end up with kids that are a lot worse off.”

    ANU Vice-Chancellor Professor Ian Young was “in a state of shock for quite a period of time about the generosity of the donation.”

    The couple will be part of a selection panel looking for the “smartest people around” from different disciplines and will consider grades, natural ability, background and drive.

    Tuckwell Scholars will receive $20,000 a year for living costs and on-campus accommodation and will socialise together at “Scholars House”.

    It’s hoped a sense of altruism will be engendered in the Tuckwell Scholars, who will give back to society in their own ways.

    “What we’re trying to identify is regardless of where they are now, innately how good are they, what’s their real desire in life and where do they get to?” Mr Tuckwell said.

    “We would like nothing more than getting kids from different states, different cities, different country towns, different whatever.”

    The program will be evaluated after five years before the Tuckwells decide whether to continue. People can apply for scholarships at tuckwell.anu.edu.au.

    So how can most of us who don’t have a massive amount of money to give, still leave our own legacies for others?

    Well I believe the first way, is to live smaller. Leave less of a footprint. Demand less and require less to be happy. In living smaller, then we have more time. The gift of time can be given to strangers through volunteering, and we can also give it to our loved ones and to our children.

    Credit always has a place – but its place is to enhance our lives so that we can spend time with the ones we love, or to really improve our quality of life or that of someone else’s. 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 buy a home, 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, so its a home we can enjoy and within its walls there’s a legacy of memories for our children to cherish.

    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.

    I am reminded of a line from the book Affluenza:

    “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.”

    But one of the richest men in Australia thinks that those aspirations to be rich and famous aren’t so worthy.

    Tuckwell is leaving an important legacy that helping others is a great gift, to them and to ourselves. He demonstrates we should do what makes us happy, that’s what matters – and if we’re good we’ll get rewarded – but it should never be about the money.

    Image:  Kittisak/ www.FreeDigitalPhotos.net.

  • Veda warns small businesses not to overcommit in lieu of Federal Budget

    Credit reporting agency, Veda Advantage is warning small businesses in the lead up to the end of the financial year that the Federal Government’s asset write-off scheme could leave them exposed to higher credit risk.

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

    In Veda’s media release today, the company warns small businesses risk over-commitment acquiring additional credit to purchase new assets with the asset write-off scheme, saying it will not be robust enough to assist all small businesses in the coming financial year.

    The new small business instant asset write-off scheme introduced in the 2012/13 budget allows businesses with a turnover of less than A$2 million to write off each eligible business asset costing under A$6,500.  The purpose of the scheme is to provide an injection of funds for businesses to invest in new ideas.

    “It’s obviously very important to closely manage the credit you take on as a small business and there are simple steps you can take to manage risk. First and foremost you need to work out if you can afford to borrow in the first place, plan your budget appropriately to see when you spend your money and how much you can afford in repayments,” says  Veda’s Head of Commercial Credit & Procurement Risk, Moses Samaha.

    “Allow for interest rate rises and anything that might affect your future income, ensure you make regular and sufficient repayments to keep the credit debt below the agreed limit and be aware of penalties if you miss a payment.

    “It’s crucial to keep your cash flow coming in greater than cash flow going out – staying  on top of this is a key success factor to keeping your business running and driving revenue. These are all simple tips but they seem to be the same traps that SMBs continue to fall for – and they can be easily avoided.”

    A recent report from the RBA showed that small businesses were hit harder by the global financial crisis and have found it more difficult to recover than larger businesses in Australia which could drive SME’s to overcommit when trying to benefit from the new scheme.

    Here is an excerpt from that report:

    “According to business surveys and the Bank’s liaison program, conditions have been weaker for small businesses than their larger counterparts over the past two years. Following the 2008 downturn, there was a less durable recovery for small businesses than for large businesses; small business conditions only briefly returned to average levels in early 2010 before being below average for most of the following two years.

    The weak conditions are apparent in small businesses’ main concerns. In the mid 2000s, these entities were becoming increasingly concerned about attracting and retaining quality staff. Following the 2008 downturn, however, this was replaced by concerns about demand for their business’ goods and services, their cash flow/ profitability and broader concerns about the economic climate,” the RBA reports in its Small Business Finance Roundtable Report.

    This comes on top of the report’s findings that more small businesses are likely to load the family up with business debt due to a lack of access to credit in many circumstances.

    “Households owning businesses are more likely to have debt (including their business debt) than other households, with around 80 per cent of business-owning households having debt in 2010, compared to 66 per cent of other households, and they tend to have higher household debt relative to income,” the report says.

    “When the balance sheets of unincorporated small businesses are compared with those of the households that own those businesses, the households are much more likely to have debt than the businesses. This suggests that many small businesses may be financed indirectly by household borrowing rather than through explicit business borrowing.”

    The RBA also reports that tighter lending standards have a greater impact on small businesses and the reassessment of risk more generally by banks has also disproportionately affected small companies.

    See full post, Small business credit lock down pushes families into more debt.

    Small businesses struggling with debt need to know both their consumer and commercial credit files are put at risk if payments go into arrears past 60 days. To find out about repairing a commercial and or consumer credit file, contact our credit repair team at MyCRA Credit Rating Repairs on 1300 667 218.

    Image: Arvind Balaraman/ 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.

  • One in four Australians short of cash would default on mortgage

    More struggling Australian families than ever do not expect to manage their existing debt levels in the coming months. The numbers of families expecting to have to default on credit like mortgages, utilities, phone and internet bills in the coming months has increased. One in four Australians would default on their mortgage if they were short of cash. This is a worrying trend, and points to a continued lack of knowledge about the ramifications of defaulting on bill payments. For people who end up with bad credit history, they can potentially enter into a cycle of debt that can take years to recover from.

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

    Alarming statistics have arisen from Dun & Bradstreet’s Consumer Credit Expectations Survey from this month – projecting into the June 2012 quarter.

    Over a third of Australian families will struggle to manage existing debt levels, with nearly half (46%) of low-income households expecting difficulty managing their debt. This represents a rise of eight percentage points since the fourth quarter of 2011, 11 points above the national average.

    Here are some of the statistics coming out of this survey:

    Default expectations

    – Overall, more than one in four (26%) of Australian consumers who are short of funds would forgo a mortgage payment.

    – Of those families that do find themselves short of cash in the coming months, more than one in ten (12%) would default on a mortgage repayment or internet bill. Fourteen per cent of families would choose to default on their pay television account.

    – Nearly one in five (19%) low-income households would sacrifice an electricity bill, three percentage points above the national average.  While six per cent would forgo a mortgage repayment.

    – An increasing number of young Australians also plan to default on mortgage repayments if short of cash. The survey also found 18 per cent of 25-34 year-olds said this would be the first bill to be sacrificed during low cash flow periods. This also increased noticeably among West Australian (up 13 points to 20%) and Victorian (up six points to 11 per cent) consumers.

    Credit use expectations

    – Number of consumers planning to use redraw facilities on their mortgage to make a major purchase was up four percentage points year-on-year to 22 per cent.

    – 41 per cent of Australian households with children will be forced to rely on a credit card to cover living expenses, up two percent since late last year.

    – A growing number of households earning less than $50,000 a year are planning to use credit to cover costs (41%), up from 37 per cent in the December quarter 2011.

    – However, 27 per cent of families plan to apply for new credit or a limit increase during the June quarter.

    According to Dun & Bradstreet’s CEO, Gareth Jones, the survey results indicate a worrying cycle of debt accumulation and dependency among struggling consumers.

    “Nearly one-in-three low-income households expect rising household debt levels, but with limited ability to pay this down. When consumers are increasingly forced to accumulate debt they are unable to manage, just to keep the family finances afloat, this has the potential to quickly become a vicious cycle,” Mr Jones said…

    “Before consumers apply for more credit they should assess whether or not they can afford to repay the funds and check their credit report to ensure there are no black marks listed on their file that could make it harder or more expensive to get credit,” he said.

    These statistics show that we are just not doing enough to educate large groups of the Australian population on the ramifications of increasing debt, and the importance of meeting credit commitments. Unfortunately, we can’t do anything about the rising cost of living for them, but we can help people prioritise. There needs to be a major shift in the Australian psyche about all credit and a major education campaign on managing debt. I think if we don’t want to end up with some kind of credit crisis in Australia – it is essential.

    Gareth Jones puts it finely when he makes the point about how consumers view bill payments:

    “Consumers tend to view non-core expenditure such as phone or internet bills as dispensable, however the damage to an individual’s credit history can be an issue irrespective of the type of account defaulted on. The default will stay on a credit report for five years and can severely limit a consumer’s ability to access affordable, mainstream credit in the future,” Mr Jones said.

    The ramifications of overdue accounts

    Any credit commitment which is more than 60 days in arrears – whether that is a mortgage, a credit card or a phone bill – is considered an overdue account, and a creditor will list this overdue account on the consumer’s credit file as a default.

    A default on a credit file is considered a ‘bad credit rating’ by all major lenders, as well as phone and utilities companies.

    The consequences of a consumer having a default on their credit file is refusal of applications for credit through most mainstream lenders for 5 years from the date the default is listed on the consumer’s credit file. The consumer is then forced to either seek alternative credit – often at sky-high interest rates, or do without credit for 5 years.

    We worked out consumers with defaults on their credit file or a bad credit rating will be hit with a whopping average $15,046.57 or more in additional home loan repayments over the first three years of their loan (this calculation is based on a home loan of $300,000 over 30 years on non-conforming loan interest rate of 9.5% vs standard variable rate of 7%).

    What this could mean for Australian consumers

    If, as the Dun & Bradstreet Consumer Credit Expectations Survey predicts, the number of Australians who say they have to use credit to pay down debts is increasing – and the number of Australians who say they may default on credit is also increasing – we could see more and more people thrown into a cycle of having to find alternative credit sources at high interest rates as the only means of paying down debts. Or alternatively we could see a higher rate of bad credit history – defaults, Court proceedings and Bankruptcies across the board in Australia.

    When a consumer seeks credit rating repair, often times they have been uneducated on how they should have handled their difficult circumstances and particularly financial hardship, prior to the default being issued on their credit file. In this instance I believe the job of a credit rating repairer can be two-fold, in one instance we are repairing the credit rating, and in the second we are educating those consumers on what the correct procedure should have been when faced with that scenario.

    If more and more people are in crisis,  then the finance industry, credit industry and government as a whole need to tell struggling consumers about their options for managing debt.

    Consumers need to know throwing away their financial futures by defaulting on repayments is the last option, not the first when they are struggling with their debts.

    For more information on obtaining and managing credit, or for information on clearing credit rating inconsistencies through credit rating repair, contact MyCRA Credit Rating Repairs tollfree on 1300 667 218 or visit our website www.mycra.com.au.

    Image: renjith krishnan/ FreeDigitalPhotos.net

    Image: Pixomar / FreeDigitalPhotos.net

  • Credit – friend or foe? 6 tips to make credit work for you

    Credit – friend or foe? Yes you should take advantage of credit, and we show you how to do that without blowing out repayments, and preventing a bad credit history.

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

    It is no secret that in this day and age many people are struggling with credit.

    Currently we are seeing lots of people running into trouble with their credit rating and the trouble sticks for 5 -7 years

    You could be forgiven for thinking that credit is the enemy…

    But we need to develop the ethos that credit is not something that is granted, it is something that is earnt. At one point banks were practically throwing money at us. Now it’s tough and you have to prove yourself.

    There is absolutely nothing wrong with using credit provided you make it work for you.

    In fact, if you have wondered ‘credit – friend or foe?’ consider what having no credit history will do for your ability to obtain credit. Not having a credit repayment history in this day and age can be just as difficult as having a bad credit rating when it comes to getting finance – especially a home loan.

    Where people come unstuck with credit is getting to a stage where they are forever chasing their tail with repayments, falling behind. Or getting blasé about repayments and not understanding what the consequences can be.

    Credit can be useful provided you make it work for YOU.

    If you can’t afford it now you can have the privilege of paying for it later – but understand that you will pay at some point. So if you don’t make your payments on time now – your credit file – your ability to take out new credit – will suffer for years to come.

    A bit about how a bad credit rating originates…

    Payments on any bills which are more than 60 days late can be listed as a ‘default’ on your credit file.

    This default can remain on your credit rating for 5 years, and can mean you are refused credit for this time. Even if the account was later paid, the credit reporting agency generally does not remove the default but can mark it as paid.

    Even defaults that you have paid still show on your credit report, and are considered bad credit history by most lenders. It is extremely important to keep a clear credit file because the repercussions will be felt for 5 years.

    Here are our 6 credit success tips…

    1. DO USE CREDIT: Having no credit history means there is nothing to calculate and the risk appears high to lenders. Start by borrowing something small. Repaying mobile phone plans, internet accounts, or store credit on time will appeal to anyone checking your credit score. Smaller purchases paid correctly contribute to approval for larger loans such as homes, vehicles and businesses in the future because they show a person’s ability to repay.

    2. MAKE REPAYMENTS ON TIME: Repay any bills received by the due date. Repay over the minimum amount required on credit cards. If you are having trouble paying on time, contact the creditor as they may be able to work out a payment plan rather than listing the non- payment as a default.

    3. HAVE A STABLE ADDRESS: Lenders like to see stability. Furthermore, defaults are easy to come by when bills are sent to the wrong address. If you do travel frequently, consider a trusted family member’s address for all bills.

    4. APPLY FOR CREDIT WITH CARE: You should only apply for credit if you feel you have a very good chance of being approved. Declined credit applications on a person’s file can hinder their chances of obtaining a loan. Likewise, you should only apply for credit you have full intention of pursuing. Every application is noted but does not stipulate whether it was approved or not. If you go shopping for credit and apply everywhere – it may look like you were declined everywhere.

    5. CHECK YOUR CREDIT FILE REGULARLY: You should check your credit file before you need to apply for credit. That way if there are any problems you can sort it out while there is no urgency, and save yourself embarrassment and disappointment from having credit declined. It is free once per year from the credit reporting agencies.

    6. DON’T LEAVE DEFAULTS TOO LATE: If there are defaults, don’t put up with them for 5 years – you may be suitable for credit repair. People can check with a credit file repairer if they can be removed.

    What about credit repair…

    Begin by obtaining a credit report – which you are entitled to do for free every 12 months via the major credit reporting agencies Veda Advantage, Dun & Bradstreet and Tasmanian Collection Service.

    If you find a default, writ or Judgment on your credit file which you believe is there unfairly, unjustly or just shouldn’t be there at all – it may be possible to have it removed.

    Credit repair is a difficult process. Time and again people are disheartened from trying to deal with creditors themselves to have the default, writ or judgment removed from their file. Most are told that default listings never get removed but can be marked as paid.

    Unfortunately, this is not enough to ensure credit is obtained in this current economic market. So basically those black marks mean you are stuck with a bad credit rating for 5-7 years, unable to borrow for homes, cars, businesses and take out simple accounts like mobile phone plans.

    Then the key is to establish a good track record on your credit file, using the above 6 credit success tips.

    Good luck!

    If you need help with repairing your bad credit history, contact MyCRA Credit Rating Repairs on 1300 667 218 or visit our main website www.mycra.com.au.

    Image: Stuart Miles / FreeDigitalPhotos.net

  • 8 things you need to know before making a home loan application

    In the 21st Century, ensuring approval on a home loan application can be complicated. Not only are savings, income and debt level all taken into consideration, but also if the person has a bad credit history. We tell you 8 things you should take into consideration before submitting a home loan application.

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

    1. Savings.

    Today’s mortgage market is much more conservative, and you may require more savings than you did, say 5 years ago.

    People with a lower income or who have more debts may be required to save closer to 10% deposit -and should enquire with a lender on where they stand in the current market.

    2. Income amount.

    The amount of income required is generally determined by the amount of income earned relative to debts and expenses.

    So, the more you earn, and the fewer debts you have, the more you will be able to borrow. If you are on a lower income, it may be worth paying off existing debts before submitting a home loan application. Also, the more deposit you have saved, the lower the income requirements on the same loan.

    3. Stable employment.

    The lender will also want to be assured of a stable income – they want to see evidence of a stable amount with a stable employer.

    Generally lenders are requiring 6-12 months with the same employer. So if you’re thinking about buying a home, best to think twice about changing jobs, even if the wages are significantly better in the new position.

    4. Debts and Credit limits.

    The lender will generally assess your debt level to determine the amount you are able to borrow. Reducing your debt can increase borrowing power.

    ‘Debt’ also includes the credit limits which are present on any credit cards or line of credit loans you may hold.

    So if you have a credit limit of say $20,000 on your credit card, the debt amount on that card will be stated as $20,000, regardless of the actual amount owing on the card.

    With this in mind, it might be a good idea to reduce any credit limits on cards or loans prior to a home loan application.

    5. Credit file checks.

    The lender will perform a routine credit file check on you to make sure there are no negative listings. This can be a default, clear out, Judgment, Writ or bankruptcy which was placed on your credit file by a creditor.

    The most common type of negative listing is a default, which can be placed on your credit file if you fail to make repayments on any form of credit past 60 days. This includes unpaid telecommunications and utilities bills.

    Defaults and Judgments remain on your credit file for 5 years, with clear outs, Writs and bankruptcies showing for 7 years.

    Most of the major lenders will refuse to lend to you if you have a bad credit history of any kind. In fact, you would probably have difficulty even getting a mobile phone plan.

    6. Excess credit enquiries.

    Whenever a person other than you makes an enquiry on your credit history – that enquiry is recorded your credit file. Currently, Australia is under a negative reporting system, so there is no way of seeing on your credit report if the loan was approved or not, only that the application was made.

    Some lenders are refusing applications due to too many credit enquiries, such as two enquiries within thirty days or six within the year.

    Ensure when you enquire about any home loan, that the lender is not making an actual application on your behalf until such time as you want to make it official.

    7. Obtain a free copy of your credit report

    If you intend to purchase a home within the year you should request a copy of your credit report. Under Australian law, this report is free every 12 months.

    There are 4 credit reporting agencies in Australia, Veda Advantage, Dun & Bradstreet, Tasmanian Collection Services (if in Tasmania) and new entrant Experian. You can obtain your credit report from one or all of these agencies. The report will be mailed to them within 10 working days of the request.

    It is essential for you to know what is being said about you on your credit file before applying for a home loan.

    There is the potential for creditors to make mistakes with your credit file. So if you are credit active you should check your credit file, regardless of how diligent you believe you are with repayments.

    8. Repair bad credit history.

    If you find listings on your credit file that contain errors, or simply should not be there, current legislation allows you to have those inconsistencies rectified.

    Defaults can be amended and marked as paid if the account has been settled, but this may not be enough to ensure finance approval.

    Unfortunately bad credit history is not cleared by creditors unless you can provide adequate reason and lots of evidence as to why the listing should not be there.

    If you have neither the time, knowledge or patience for credit repair you can seek out a professional credit repairer who will be able to work on your behalf to negotiate with creditors to have the negative listing or default removed.

    A clear credit record will allow you to choose the best loan for you, with the best interest rate.

    Contact MyCRA Credit Repairs for help in getting your bad credit history sorted out – call tollfree on 1300 667 218 or visit our main website www.mycra.com.au.

    Image: vichie81/ FreeDigitalPhotos.net

  • What you may not know about taking out credit in Australia

    Many Australians are very unaware of what happens behind the scenes when they take out credit. We break it down and show you what it involves, and how your good name and ability to continually obtain credit all  hinders on what creditors say about you on your ‘credit file’.

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

    What is being ‘credit active’?

    When you take out your first piece of credit – you become ‘credit active’. This could be a mobile phone plan, a loan with a bank, a credit card, or even a utility account. The creditor opens up a credit file in your name with one or more of Australia’s credit reporting agencies – Veda Advantage, Dun & Bradstreet, Tasmanian Collection Services TASCOL (if in Tasmania) or new entrant Experian Australia.

    What is on my credit file?

    Your credit file details all of your personally identifiable information including full name, date of birth, current address and also the type of credit that has been taken out now and in the past. Also recorded, are any times you have applied for credit ‘credit enquiries’ and any negative notations put there by creditors during the course of the credit agreement.

    What is a credit rating?

    Your credit rating is a term used for what happens when a potential creditor makes a request to see what is reported about you on your credit file. The creditor uses the information on your credit file to determine the amount you are able to borrow and your ability to repay the loan.

    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 basic defaults and even too many credit enquiries or applications for credit may be considered to be tarnishes on your credit rating.

    How do I get a bad credit rating?

    If you fail to make repayments on any credit account past 60 days, then by Australian law the creditor has the right to notify you in writing of their intention to list the non-payment as a default on your credit file. This default remains present on your credit file for 5 years, after which time it drops off. If the creditor can’t contact you, and suspects you have left the premises or tried to avoid contact – they may list the non-payment as a ‘clear-out’ which means you would incur 7 years of bad credit.

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

    Most people know they have a bad credit rating, because the creditor has advised them in writing that they intend to list something negative on their credit file. But many times, people are not aware they have a bad credit rating until they apply for a loan and a ‘surprise’ default or clear-out shows up.

    If you are unsure what is on your credit file, you should take the time to find out.

    The three major credit reporting agencies in Australia hold the credit file of millions of Australians. Veda Advantage alone holds over 14 million credit files.

    You can write to or email one of these agencies and request a credit report, which is a copy of your credit file.  If you are not in a hurry then under Australian law your credit report is free, and will be sent within 10 working days from application to receive this information. There are further charges for a faster service with many agencies.

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

    If you discover you have a bad credit file, you will find it very difficult to obtain credit in the future. Generally this problem will keep occurring for the 5 years the default is on your file. This will probably prevent you from obtaining a home loan with most lenders and possibly lead to credit refusal of many kinds from cards to phone plans. Even if this bill is paid and noted on your file, this default usually remains on your record for 5 years and will be a detriment to any further credit you wish to take out during this time.

    What can I do to fix the default on my credit rating?

    Once you have obtained a report there are three things to consider about the negative listing:
    1. Is it accurate?
    2. Was I informed?
    3. Is it fair?

    If the report contains errors, or inconsistencies with the credit reporting process, be aware you do have the right to have errors rectified.  Creditors do make mistakes in credit reporting. The way we handle it can be make-or-break for our good credit rating.

    In many cases where people have attempted to 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 be both unfair and may not be sufficient to ensure credit is obtained with some lenders.

    Can I employ someone to fix my bad credit?

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

    A professional 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. They will also look at any other extenuating circumstances to determine if there is an avenue that can be investigated which results in having the listing removed.

    Can I make positive changes to my credit file?

    As the legislation currently stands in Australia, there is no way of off-setting bad credit history with ‘good’ credit history. Currently only negative entries are recorded – so you are considered to have good credit history if your credit file is essentially clear.

    Australia is moving towards a form of positive credit reporting this year – but we believe banks will still not take kindly to any form of negative entry on a person’s credit file in this current economic climate.

    How do I keep a clear credit rating?

    To avoid a bad credit rating, it is essential to make repayments on time! If there is a problem with a bill, you still need to pay it on time. If there is hardship and you are finding repayments difficult, tell creditors. Most creditors have policies in place to assist with financial difficulties – but you must tell them to be eligible for this.

    Keep your contact details current with your creditors so if there are problems they can contact you.

    And make sure there are no mistakes on your credit file…

    The best thing every credit-active person can do is to keep abreast of what is being said about them on their credit file with those free yearly credit file checks. This way, if there’s anything that appears on there that you are not sure about, you can look into it and get your credit file cleared if it should not be there BEFORE you front up to apply for any new credit.

    If you have a bad credit rating, go through these 6 simple steps to see whether you may qualify for credit repair, or contact us tollfree on 1300 667 218 or visit our main website www.mycra.com.au :

    Image: vichie81 / FreeDigitalPhotos.net

    Image: renjith krishnan / FreeDigitalPhotos.net

  • Keep your head when you follow your heart this Valentine’s Day

    Happy Valentine’s Day for tommorow, 14th February everyone…hoping cupid’s bow meets its target this Valentine’s Day and sends you someone special. If it does – and you are about to take the commitment road, here’s some important points you need to know about joint debt to prevent a bad credit score.

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

    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’. In this process it is important to remind ourselves of the important things about ourselves that should not change no matter who we’re with. Now going deep into that is probably another blog altogether. But let’s just concentrate on our finances and how we can maintain our good name and our clear credit file when we take our relationship to the next level of commitment with joint debt.

    Some of us are great with money and some of us aren’t. If one of each type get together – the potential for both 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.

    When we take out any credit together, such as loans, utility accounts, homes and rental properties, we become very reliant on our partner to keep up their end of the credit repayments. Very often one partner ends 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. A bad credit score due to a default lasts for 5 years, a ‘clearout’ listing is 7 years.

    So many times we hear clients say “I’m not sure how this happened – how can my clear credit file be damaged by something my partner did?” Unfortunately when couples go into joint debt, both credit files are at risk if repayments aren’t made.

    So how do people protect themselves, their assets and their good credit rating, BEFORE they marry or move in together and create joint debt?

    Many people come unstuck by not asking the tough financial questions about their prospective partners early in the relationship:

    1. Ask about your new partner’s financial past. People will do what they have always done. If they have financial skeletons in the closet we should be wary about leaving our credit rating at risk.

    2. Ask what debts they currently have. This will give you an indication of how they feel about money, and how much debt they consider normal to handle. Does this match with yours?

    3. Talk about paying bills. Do they always pay them on time? If not, why not? This will give you a good indication of how this person regards money and credit repayments. Ring any alarm bells yet?

    4. Ask what their financial goals are for the future. Do they match yours? If your new partner wants to blow all of their money on an overseas trip, but you want to save for a home – how will this work long term?

    5. Verify their answers about existing and past debt. Ask them if you can see a copy of their credit file (and versa of course). A copy of your credit report is free every year from one or more of the credit reporting agencies in Australia. It will be sent within 10 working days.

    If some of the answers to these 5 questions don’t leave you running out the door, but leave you wondering whether you are on different planets when it comes to money, it could mean you need to keep your finances separate for a significant period of time. For instance, just because you have bought a home together doesn’t mean you can’t keep other bank accounts, credit card and previous homes you own in your name only.

    It might also be a good idea to be the one responsible for all joint debt accounts, and to check those statements regularly for any issues.

    It is also important long term to order a copy of your credit file regularly. This will notify you of any problems before you apply for credit in the future.

    Just remember that as high as emotions can run, they can also get just as low. Your financial generosity now could become the very thing that is used against you if the relationship sours. Before you enter into any financial transaction, consider carefully how secure you would be if things did take a turn for the worse. Then you can relax and enjoy the buzz of falling in love.

    For help with fixing credit rating or listing errors, contact MyCRA Credit Repairs on 1300 667 218 or visit our website www.mycra.com.au.

  • The dead not protected from identity theft

    Even in grief identity theft can strike us and affect our credit file and the clear credit file of those we leave behind. Grieving relatives may need to protect themselves and their loved one’s good name against this fraud, following a recent spate of identity theft of deceased individuals.

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

    There are so many things to think about when someone dies and it is very unfair that grieving relatives need to think about possible identity fraud on top of everything else, but the fact is it may be necessary to protect not only their memory, but the good credit file of the living.

    Last year a Sydney court sentenced a man and a woman to two years jail for identity theft.

    The Courier Mail ran details of the story in September last year, in which the court heard the couple “spent nine years trawling cemeteries across Australia collecting the details of dead people, with Queensland targets including a disabled man and a baby less than two days old.”

    “The couple created fake “identity kits” using the details of the deceased, including bogus passports, Medicare cards, drivers’ licences and bank accounts, which they sold to criminals for up to $30,000 each”, the story said.

    In October, The Australian ran a story ‘Backlog of births, death records prone to identity theft’, detailing the possible prevalence of these instances of ID Theft. It told of data processing backlogs at some government birth, deaths and marriages registries that have left the door open for fraudsters to assume the identities of dead Australians.

    The fixing of the identity loophole had been delayed by a dispute with developer UXC, whose contract with the NSW Registry was terminated in 2009. The registry said it had received $2.9 million in damages as a result.

    A new contract had now been negotiated with Objective Consulting for $11.4m, with the first release of a new registry due in June next year.

    Queensland too is yet to digitise its birth, death and marriages records to enable automatic cross-checking between births and deaths data.

    “The project is currently in the final stages of contract negotiation with digitisation currently scheduled to run from early 2012 to 2014,” a Queensland Births, Deaths and Marriages Registry spokeswoman said.

    Queensland’s 2009-10 budget had allocated $20.8m for digitisation of records.

    The spokeswoman said when digitised, its operators would be required to complete an electronic search of Queensland death records before releasing a birth certificate.

    Software developer John Doolan, who has worked with birth, deaths and marriages registries across the Australian eastern seaboard for more than 20 years, said the enormous backlog in unmatched birth and death records was a headache.

    “We are aware of cases of false identities that have been created and stolen,” said Mr Doolan, the chief executive of KE Software, which has different versions of its software operating in Queensland, NSW, Victoria and Tasmania.

    The ability of a person involved in immigration fraud, tax evasion, social security rorts and even terrorism to obtain a legitimate birth certificate by using a dead person’s identity is still possible at these registries.

    While states are rushing to digitise this process, relatives should be aware of how a deceased person’s personal information could be compromised, and act quickly to protect their  credit file and good name in death.

    – Relatives can start by obtaining several copies of their loved one’s death certificate, and providing one to each credit reporting agency in Australia. The credit reporting agency can then ‘flag’ the credit file so that no future credit is issued in that name.

    – Also pay particular attention to how much information is given away in the obituary. As in life, in death, personal information is a valuable commodity. Restrict the publication of any details which could allow fraudsters to piece together details to create a false identity.

    – It is also important to provide a death certificate to financial institutions and notify all other credit facilities of the death, particularly where joint accounts may be involved. This could prevent the other person attached to the joint account of the deceased having their clear credit file compromised by possible identity theft.

    If fraudsters gain access to someone’s good name – living or dead they may be able to drain bank accounts, or open new lines of credit in the person’s name.

    Often people don’t find out about the identity fraud until they attempt to take out credit and then find out they have a bad credit score due to a series of defaults they have no knowledge of. It was reported that in the case heard by the Sydney courts, the names of the deceased were used to create false Medicare cards, birth certificates, drivers’ licences, bank accounts and credit cards. Forged documentation and identities were sold to criminals, including members of the Lone Wolf bikie gang, so they could apply for passports.

    Any kind of credit account (from mortgages and credit cards through to mobile phone accounts) which remains unpaid past 60 days can be listed as a default by creditors on the victim’s credit rating, and those defaults remain there for 5 years.

    Relatives left with the task of trying to repair the credit file of their deceased, particularly the credit files of joint account owners can find the task a difficult one. To restore the clear credit file the identity theft victim needs to prove to creditors they did not initiate the credit. Not only are victims generally required to produce police reports, but large amounts of documentary evidence to substantiate to creditors the case of identity theft.

    If people need help credit rebuilding and restoring credit activeness following identity theft, please contact MyCRA Credit Repairs tollfree on 1300 667 218 or visit the main website www.mycra.com.au

    Credit rebuilding is not easy for anyone to undertake themselves, particularly those who are facing grief. Many times when restoring credit individuals will be told that listings can be marked as paid, but this does not give the victim a clear credit file.

    Using a credit repairer skilled in credit reporting legislation will help to enforce rules creditors are bound to comply with, and coupled with negotiations will ensure the best chance at a clear credit file.

    Image: Arvind Balaraman / FreeDigitalPhotos.net

     

     

  • How to dispute a bill and keep a clear credit file

    What many credit repairers don’t want you to know…There’s a wrong way to dispute your bill. The wrong way can lead to bad credit history – leaving you unable to obtain credit for 5 to 7 years. Here is how you should dispute your telephone, internet, energy or basically any bill which you disagree with before it ruins your credit file.

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

    Customers who refuse to pay a bill because they believe it has errors are making a grave mistake that could harm their ability to get credit in the future.

    One of the most common mistakes people make which leads to bad credit history is not paying a disputed bill by the due date.

    Creditors make mistakes with billing all the time, otherwise however infallible they may like to think their system is, otherwise there would be no need for professional credit repair.

    It can be really difficult getting the matter resolved with some creditors. But no news is definitely not good news.

    Where many customers go wrong, is assuming just because they have spoken to someone on the phone about the bill, they are no longer obliged to pay it by the due date.

    Under current credit reporting legislation, an account which is more than 60 days late can be listed by the creditor as ‘unpaid’ on the customer’s credit file. This is regardless of whether the customer believes there are errors in the details of the bill or with the payment amount.

    Many clients dispute the offending bill with the company and made the mistake of leaving the bill unpaid well past the due date while waiting for correspondence from the company. Many are not aware they have incurred a default anyway, until they apply for credit in a different circumstance.

    These defaults remain on a person’s credit file for 5 years. Under current legislation, defaults generally don’t get removed from a credit file, but can be marked as paid if they have been paid.

    Currently, defaults – even those that are marked as ‘paid’, will prevent you from obtaining a home loan with most lenders. In fact, even having a few too many credit enquiries can be enough for an automatic decline.

    So it’s really important we don’t leave ourselves open to having a default listing slapped on our credit file, ruining our good name.

    Here is the process people should take when disputing a bill in Australia:

    1. Contact the bill provider as soon as you receive the bill and attempt to resolve the discrepancy.

    2. Make a note of the date of all conversations, the name of each person you speak to and the nature of the discussion with each. Note any resolutions that were reached and ask that those be emailed or sent to you in writing.

    3. If the credit provider fails to honour the discrepancy, advise them you will be contacting the appropriate ombudsman.

    4. If the due date for the bill approaches and the issue has not been resolved, pay the bill by the due date. You can always seek reimbursement at a later date, but this will prevent a default for that bill being listed on your credit file.

    5. If there is still no resolution, take the matter further, usually with the appropriate Ombudsman.

    So don’t assume anything or take someone’s word for it, get it in writing and preserve your clear credit file.

    If you already have bad credit history from a bill dispute that went wrong – it may not be all lost. The best way to fix your credit score is to seek professional credit repair.

    Australian credit reporting legislation allows for you to resolve any inconsistencies on your credit report. But the problem with attempting to dispute errors on your credit file with creditors yourself is two-fold. Without knowledge of the legislation, people almost invariably get caught in legal ‘loop-holes’ which see the default, writ or Judgment left on the credit file, or at best see the listing marked as ‘paid’.

    Both of these results DO NOT fix your credit rating because lenders still consider even a ‘paid’ listing as bad credit history. Secondly, by negotiating with creditors, people can also accidentally ‘alert’ creditors to any mistakes the creditor may have made in the initial method of credit reporting – allowing them to fix up their mistakes and negate the need to remove the credit file default which was placed in error.

    Good professional credit repair gives you the best chance at fixing your credit.  A credit repairer can help you get a free copy of your credit file, and go through the bad credit history with you. 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 errors from your credit file, but many times you are able to start off with a completely clean credit rating.

  • Safer Internet Day February 7 2012: be cyber-smart for a future clear credit file

    How to be cybersmart – that’s an important topic. On February 7, Australians have the opportunity to raise awareness as to how children and parents alike can be smart on the internet. This is essential for many reasons, one of which is to preserve our personal information, our financial identities and our clear credit file. Cyber-smart are hosting ‘Safer Internet Day’ with this year’s theme, ‘connecting generations and educating each other’, focusing on promoting a dialogue on online safety amongst all generations.

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

    Cybersmart’s key messages for schools, libraries and families this Safer Internet Day are:
    •Talk about online safety—with all members of your family and school community
    •Protect Your Privacy—check your privacy settings and update your software
    •Educate yourself about the online world—check out the Cybersmart resources.

    How can a young person’s clear credit file be put at risk from their internet use?

    Our young people need to be cyber-smart and also, young people need to be credit-savvy to get along in this modern world.

    One issue we wish to highlight to help young people stay smart online is for them to be aware of the ways in which they can be putting their clear credit file at risk every time they post information publicly on the internet, even before they are credit-active.

    It’s unfortunate that teenagers in Australia today are not immune to identity fraud. Even though they are not yet 18, the personal information that is made public today could be used against them in the future.

    Many teenagers do not know the risks of having a public ‘profile’ on sites like Facebook and Twitter, but fraudsters do. With the volume of personal information that is publicly available about our young people on social network sites, what’s to say fraudsters can’t pull that information and use it to build a profile that could allow them to create a fake identity?

    A young person who becomes the vicitm of identity theft could have their clear credit file ruined for five years. They may not even get a chance to get a mobile phone or take out a credit card themselves.

    Late last year, the Australian Federal Police’s national co-ordinator of identity security strike team, Ben McQuillan spoke about the dangers of identity crime at a forum on money laundering and terrorism.

    He warned forum listeners about the new trend of ‘data warehousing’ which involves storing data for a time, making it harder for a victim or bank to trace where and when the data was stolen.

    ”If people know your full name, your date of birth, where you went to school and other lifestyle issues, and they were to warehouse that data, there is a prospect that could then be used to take out loans or credit cards or to create a bank account that could then be used to launder money,” Mr McQuillan told the Sydney Morning Herald.

    Identity theft  is not only about the initial loss of monies, but if the fraud amounts to credit accounts in the young victim’s name going undetected and unpaid past 60 days, creditors will issue defaults. It need not be major fraud to have a detrimental effect to the young person’s clear credit file. Credit file defaults for as little as $100 can stop someone from being able to obtain credit. So any misuse of someone’s credit file can be extremely significant.

    Repairing bad credit, even following identity theft is not easy. The onus is on the victim to prove to creditors they didn’t initiate the credit. The fact that the perpetrator is long gone and the actual act of identity theft happened years earlier will only add to the difficulty for the young person in recovering their clear credit file.

    Experts recommend parents and young people continue to update their skills on how to be cyber-smart.

    The government’s ‘stay smart online’ website offers some top tips about using the internet which can be discussed with young people at home and school:

    Top tips

    Make sure your computer is secure—follow the advice in the Secure your computer section of this [fusion_builder_container hundred_percent=”yes” overflow=”visible”][fusion_builder_row][fusion_builder_column type=”1_1″ background_position=”left top” background_color=”” border_size=”” border_color=”” border_style=”solid” spacing=”yes” background_image=”” background_repeat=”no-repeat” padding=”” margin_top=”0px” margin_bottom=”0px” class=”” id=”” animation_type=”” animation_speed=”0.3″ animation_direction=”left” hide_on_mobile=”no” center_content=”no” min_height=”none”][stay smart online] website.

    Set strong passwords, particularly for important online accounts and change them regularly—consider making a diary entry to remind yourself.

    Stop and think before you share any personal or financial information—about you, your friends or family. Don’t disclose identity information (drivers licence, Medicare No, birth date, address) through email or online unless you have initiated the contact and you know the other person involved.

    Don’t give your email address out without needing to. Think about why you are providing it, what the benefit is for you and whether it will mean you are sent emails you don’t want.

    Be very suspicious of emails from people you don’t know, particularly if they promise you money, good health or a solution to all your problems. The same applies for websites. Remember, anything that looks too good to be true usually is.

    Limit the amount and type of identity information you post on social networking sites. Don’t put sensitive, private or confidential information on your public profile.

    When shopping online use a secure payment method such as PayPal, BPay, or your credit card. Avoid money transfers and direct debit, as these can be open to abuse. Never send your bank or credit card details via email.

    When using a public computer, don’t submit or access any sensitive information online. Public computers may have a keystroke logger installed which can capture your password, credit card number and bank details.

    We encourage anyone who is interested in protecting their identity and their clear credit file whilst online to visit the stay smart online website regularly, and if people have children, the Cybersmart website is essential reading for both the young person and parent.

    Get involved in the Safer Internet Day, and help educate someone you know about online safety.

    If you require further information about maintaining a clear credit file or repairing bad credit, visit our main site www.mycra.com.au or call us tollfree on 1300 667 218.

    Image: imagerymajestic/ FreeDigitalphotos.net[/fusion_builder_column][/fusion_builder_row][/fusion_builder_container]

  • MyCRA clients tell their stories: Telco mistakes threatening home ownership

    Two of our credit repair clients share their stories on how their good credit rating suffered at the hands of Telco mix-ups. Their stories demonstrate how bill and service disputes can be difficult for customers to resolve, and can ultimately lead to a bad credit rating.

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

    DANIEL

    A NSW client, Daniel and his young family were shocked when they applied for a home loan last year to find they were refused due to a whopping $8,000 debt and five years of bad credit when a botched phone plan with Telstra in 2006 came back to haunt them.

    Daniel was told by the lender there was no way he would be given a home loan with a black mark against his name – a mark Daniel says was a huge mistake.

    “I was on a 10MB plan initially, but wanted to start using the internet from my phone. I contacted Telstra to get upgraded to 1GB, which the operator agreed to. It wasn’t until I got the bill for $4,000 that I saw the operator hadn’t changed the data allowance and I was still on 10MB,” he explains.

    Daniel says he spent more than 3 months in contact with Telstra attempting to resolve the problem, and was passed on from one person to another.

    “All the operators said they didn’t have the authority to remove this bill or change it. No one was willing to help they all just kept passing me around operators which lead to hours on end being caught up on the phone without getting answers,” he says.

    “After a few months they disconnected my phone, but I had no idea they had referred the debt to a collection agency, and banned me from credit for 5 years.”

    Thousands of Telco customers are living with negative listings on their credit file that just shouldn’t be there, and this should serve as a warning to all credit active individuals to check the accuracy of their own credit rating.

    Consumers need to know that mistakes do happen for a variety of reasons, and often it is not until people apply for credit in a separate instance that they find out – by then it is too late.

    An annual report released November last year by the Telecommunications Industry Ombudsman (TIO) reporting on the number and nature of consumer complaints in the 2010-11 year, revealed a staggering 18 per cent increase in complaints from the previous year.

    The TIO report attributes the rise in complaints to them to mobile phone service faults and increased smart phones use.

    “The record number of complaints made to the TIO is disappointing. Customers who have complained to us have been frustrated not only by mobile telephone problems, but also by deficient customer service and complaint handling,” Ombudsman Simon Cohen said.

    Daniel says trying to get the mistake fixed up and rebuild his credit file himself, was problematic.

    “I tried to clear it with Baycorp, they told me if I paid the debt they would reduce it to $6,000 – which I did. Unfortunately that didn’t clear my credit file, it was only marked as ‘paid’ and was no use to me getting a home loan,” he says.

    Many people have trouble resolving errors themselves, because they aren’t familiar with the legislation and find it difficult to negotiate with creditors.

    Customers can often be given the run-around by creditors, and can find it difficult to apply the letter of the law to their own circumstances when they have no knowledge of what the rules are. Sometimes that can do their case more harm than good.

    Daniel’s case has since been resolved, and MyCRA Credit Repairs have been successful in recovering the $6,000 he paid out to Baycorp.

    “We’re relieved to be finally getting a home, but the whole thing has left us very disappointed in big corporations – you really don’t get looked after,” he says.

    BRENT

    Another client, Brent from Western Australia had a contract with provider, ‘3’ in 2009 that went badly.

    About 3 months into his phone contract, Brent experienced numerous problems with his phone, sending it to be repaired 3 times before requesting a replacement. He posted the phone back to Sydney and received a new phone.

    A month later Brent’s phone was barred, and he received a phone call from 3 stating that he owed $1200 for the phone which 3 said was never returned.

    Brent spent a few months dealing with 3 trying to track down the phone in their warehouse and the postal system, before they eventually located it.

    It wasn’t until he applied for a loan and was turned away that he found out 3 had placed a default on his credit file anyway, despite an agreement to put a note on the account so that the outstanding amount for the missing phone did not get referred to a debt collector.

    MyCRA Credit Repairs fought for Brent to have the default removed from his credit file.

    It is so important for people to cover themselves when resolving bill and service disputes with Telcos or any creditor for that matter.

    People should never assume mistakes are rectified until they have confirmation in writing from the company. If you have a problem with a bill or service, take extensive notes and names and request confirmation of all decisions and outcomes in writing.

    If people are worried about what may have been reported about them on their credit report, they are entitled to obtain a copy of their credit file for free from the credit reporting agencies in Australia once every 12 months.

    The report is mailed to the credit file holder within 10 working days. If consumers find errors, or listings which they believe are inaccurate or unjust they have the right to have them removed.

    For help with rebuilding a credit history and repairing your bad credit rating contact MyCRA Credit Repairs tollfree on 1300 667 218 or visit the main website, www.mycra.com.au.

    Image: Stuart Miles / 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