MyCRA Specialist Credit Repair Lawyers

Tag: credit laws

  • Be careful where you live because it can affect your credit score

    Media Release

    where live affect credit scoreBe careful where you live because it can affect your credit score

    15 April 2014

    Australia’s new credit laws have some consumers on edge and checking their credit score to ensure they’re not blacklisted – but a consumer advocate for accurate credit reporting says beware, your credit score can be lowered by where you live as well as what you do with credit.

    Graham Doessel, Non-Legal Director of MyCRA Lawyers, a firm focused on credit disputes says many things can reduce your credit score, including your address.

    “Basically all the details asked for on your home loan application form can be used to calculate a credit score, including where you live,” Mr Doessel says.

    The former broker says some suburbs put you in the credit danger zone.

    “It’s not common knowledge, but when it comes to your address some suburbs are listed as high for commercial credit risk and if you happen to live in that suburb your score may be lower than what it would be if you lived somewhere else,” he says.

    Credit reporting bureaus such as Veda Advantage and Dun and Bradstreet hold information on millions of consumers, and use this data to make predictions about credit risk. They also publish de-identified information on their collected data from time to time, such as with Dun and Bradstreet’s 2009 publication ‘Consumers still in the danger zone – A geographic look at consumer credit risk across the country’ (1)

    “The Geographic Risk Indicator (GRI) assesses the likelihood of future default on a credit obligation based on demographic data. Those areas categorised as a high risk are 3.4 times more likely than average to be inhabited by individuals who have experienced previous negative credit events,” the publication states.

    “It may not be fair, but the truth is, if you live in a ‘bad’ suburb your score will be reduced even if you are personally a good credit risk,” Mr Doessel says.

    So what else can contribute to lowering your credit score?

    Mr Doessel says how long you’ve lived at your address can also contribute to a low score.

    “Lenders like to see stability, so moving just before you put in an application for finance is probably not ideal, depending on how much you’re borrowing,” he says.

    Some of the many factors Veda Advantage might take in to consideration when calculating their VedaScore can include: (2)

    · Types of credit provider you have made credit enquiries with (Credit providers are rated as high to low risk lenders) · Type and size of credit requested in your application

    · Number of credit enquiries and shopping patterns

    · Directorship and Proprietorship information

    · Length of employment

    · Age of credit report

    · Default information including court writs and default judgments

    Mr Doessel says default information can play a big part in how your score is calculated.

    “Of course any adverse listings such as defaults or Court Writs and Judgements and Bankruptcies can really lower your credit score even if you live in a great suburb. We’ve helped millionaires with disputing credit listings impacting their ability to get finance,” he says.

    He says repayment history is a grey area as to how it could impact your credit score. This is relevant to you if your credit provider decides to opt in to the new comprehensive credit reporting system and lists payments on your credit card or loan accounts which are more than 14 days behind.

    “It’s important to pay your credit accounts on time every time as we just don’t know what impact even one late payment notation could have on your credit score,” he says.

    /ENDS.

    For interviews and more information please contact:

    Graham Doessel – Non-Legal Director MyCRA Lawyers Ph 3124 7133

    Lisa Brewster – Media Liaison MyCRA Lawyers media@mycralawyers.com.au

    www.mycralawyers.com.au www.mycralawyers.com.au/blog

    MyCRA Lawyers 246 Stafford Rd, STAFFORD Qld Ph 07 3124 7133

    About MyCRA Lawyers: MyCRA Lawyers is an Incorporated Legal Practice focused on credit file consultancy and credit disputes. MyCRA Lawyers means business when it comes to helping those disadvantaged by credit rating mistakes.

    Links:

    (1) http://dnb.com.au/library/scripts/objectifyMedia.aspx?file=pdf/32/14.pdf&siteID=1&str_title=Consumers+still+in+the+danger+zone+-+GRI+Report.pdf

    (2) http://www.veda.com.au/yourcreditandidentity/check/vedascore/how-my-vedascore-calculated

    Image: Danilo Rizzuti/ www.FreeDigitalPhotos.net

  • A wait and see approach to logistics of new credit laws

    Most people are very positive about changes to Australia’s Privacy Laws which are coming through Parliament, effectively bringing Australia out of the 1980’s and closer to other countries in our treatment of Privacy and personal information. But others are a little unsure they go far enough in many areas. We look at one opinion of how the new credit laws apply to credit reporting .

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

    An interesting post came through from ‘The Conversation’ yesterday written by Bruce Arnold, Lecturer of Law at University of Canberra. The post Two cheers for privacy law reform? Let’s wait and see looks at the potential benefits of these new Privacy Laws, and where perhaps the laws may be lacking:

    “For many people the bleeding edge of privacy law has been their credit records. The Bill rationalises the current credit reporting regime, which has featured strong disagreement between competing industry bodies and examples of bad practice by particular enterprises. That rationalisation is to be strongly welcomed by consumers and business as providing greater transparency and certainty. Its success however will be dependent on action by the national Privacy Commissioner, an entity within the national Office of the Information Commissioner. Under the proposed law, credit providers will have access to additional personal information with the expectation that more data will facilitate “a more robust assessment” of credit risk and “responsible lending” that may also “result in reductions to the cost of credit for individuals”. As with much finance, we will trust that lenders will pass on their savings to consumers.

    The Bill aims to give the Commissioner greater powers, for example scope for “own motion” investigations rather than in response to complaints by individuals who claim that there privacy has been disrespected. It is unclear whether the Commissioner will make effective use of those powers, given difficulties with resourcing and perceptions – fair or otherwise – that the office lacks both the will and expertise to take on particular interests. Historically it has endorsed industry practice that although commonplace, is below overseas benchmarks and is less than desired by many Australians.

    The Commissioner will be able to recognise external dispute resolution mechanisms, something that is consistent with the trend to outsourcing and administration and presumably welcomed by business.

    The Bill does not provide for a tort of serious invasion of privacy – that is, scope for an individual to seek compensation over an invasion of their privacy by an individual or an organisation. That tort has been recommended by the ALRC and by the law reform commissions of New South Wales and Victoria. It is thus hardly a radical or alarming notion, although it has been strongly opposed by the major media groups and some legal practitioners. The Government’s willingness to proceed with suggestions for establishment of the tort as we head towards an election is unclear.

    Enactment of the Australian Privacy Principles is a step forward, deserving of two cheers even if we ask why has it taken so long and wonder how the APP will be interpreted by the Privacy Commissioner. Rationalisation of credit reporting law, in conjunction with the National Consumer Credit Protection Act 2009 (NCCPA) is also meritorious, although in one of the most messy areas of privacy practice we will need to see how business implements the revised arrangements and whether there is meaningful enforcement by the Privacy Commissioner,” Mr Arnold says.

    It will be interesting to see how the actual application of dispute resolution pans out in the credit reporting landscape including how the changes will alter the Credit Reporting Code of Conduct. We will certainly adopt the ‘wait and see’ approach as to whether the changes will indeed make it ‘easier’ to dispute credit listings and fix unnecessary bad credit as claimed by Attorney-General Nicola Roxon.

    Image: Stuart Miles/ Free Digital Photos.net