MyCRA Specialist Credit Repair Lawyers

Tag: credit rating

Keep updated about threats to your credit file:

Do you really know if your credit rating is safe when you’re shopping, surfing, communicating and transacting online? When you understand personal information and how it can be used by fraudsters, you want to do all you can to protect your personal information both online and offline. We look at one of the best things you can do to stay up to date with threats to your identity and credit file, and ensure you Stay Smart Online.

By Graham Doessel, MyCRA Lawyers www.mycralawyers.com.au. Stay Smart Online Week 2014.

It’s important in our age of technology to be able to confidently engage online. But it is equally important to be able to stay safe while doing that.

How do you know when you need to update software? Or change a password? When will you know about Security breaches to entities which hold your personal information?

The Australian Government provides a free subscription based service to home internet users and small businesses offering practical advice about security issues and observations which could impact you, your finances, your identity and your credit rating.

The Alert Service provides easy to understand information about the latest internet threats, scams, and other risks, and how they can be recognised and addressed. If you’re using your computer at home (and lets face it – who isn’t?) this is like internet security 101.

We encourage all of our readers to subscribe to this service. It could just save your bacon one day when it comes to internet threats.

Click here to subscribe to the Stay Smart Online Alert Service.

Internet fraud can lead to identity theft and in this situation often your credit file can be misused.

If a fraudster is able to garner enough personal details to get duplicate documents in your name, they not only have your identity – they have access to your credit rating as well.

This means they can take out credit in your name…and if they’re well-versed in this process – it may not be evident your identity is even compromised until you go to take out credit yourself and are refused.

Unravelling the tangled web of identity theft at this point can be at times impossible. And unlike bank or credit card fraud, there’s not always reimbursement to be found. Some victims have found they have had to cop the 5 year default on their credit file, because they don’t understand and therefore can’t prove how the identity theft occurred in the first place.

So our message this week is: take heed, and safeguard your personal information to prevent identity theft and credit file misuse.

For more information on credit file misuse, or to get more help or information about the security of your credit file, visit our main site www.mycralawyers.com.au, or you can contact us on 1300 667 218.

02/06/2014
Credit law series: Bad credit mistakes in Australia

In this credit law series, we look at bad credit mistakes. Do you have a bad credit rating and don’t know why? Have you had bad credit placed on your credit file you don’t agree with? You are not alone. Possibly millions of people in Australia have a bad credit rating, and many people are unaware they have black marks against our name until we apply for credit and are flatly refused. We look at the ins and outs of bad credit mistakes and what you can do about them.

By Graham Doessel, Non-Legal Director of MyCRA Lawyers www.mycralawyers.com.au.

What is a bad credit rating?

‘Bad credit’ in Australia is generally credit listings such as defaults, writs, Judgments or Bankruptcies recorded against your name on your credit file by a Credit Provider.

Most of these listings can make it very difficult to obtain credit for 5 years for defaults and up to 7 years for bankruptcy. This can affect many major areas of your life such as buying a home, taking out personal loans for vehicles, business loans and in many cases even credit cards and mobile phone plans.

Currently, most of the major banks are rejecting home loan applications where the credit history shows a default listing (an overdue account which has lapsed past 60 days). Many lenders are even rejecting loans for excess credit enquiries such as two in thirty days or six within the year.

How common are bad credit mistakes?

There are over 16.5 million credit files for ‘credit active’ people, held by the major credit reporting agencies in Australia; Equifax (Formerly Veda Advantage), Dun & Bradstreet, Tasmanian Collection Service. (16.5 million credit files are held by Equifax (Formerly Veda Advantage) alone).
Unfortunately, there are no current statistics on the number of credit mistakes which occur on Australian credit files.

But to give you some idea, in 2004 the Australian Consumer Association (now Choice) conducted a survey which revealed 34% of the credit files of the people surveyed possibly contained errors.

Most people that query Credit Providers and credit reporting agencies about their bad credit – especially where there’s a default, are told that the listing can’t be removed but can be marked as ‘Paid’ if the account was settled.

This is often not good enough if you need to use credit over the next 5 years (which is almost everyone nowadays).

What sort of bad credit mistakes are disputable?

You should know that any credit listing which you believe is inconsistent, unfair, or incorrect can, and should be disputed. Credit rating mistakes could be anything from the credit listing placed by your Credit Provider on the wrong credit file; to the basis of the credit listing being unfounded; to incorrect notices being provided to you; right through to system errors and incorrect spelling, to name a few examples.

How do I repair my bad credit rating?

One important aspect to disputing a credit listing in Australia (also known as credit repair) is to remember is that we usually only get one chance at clearing our credit file.

Sometimes we can attempt to deal with Credit Providers to remove the credit rating default ourselves and can do more harm than good by not understanding the legislation. This is where a firm focused on credit law can help.

What does a credit law firm do?

Disputing (or repairing) a credit file involves reviewing documentation– including the credit file and all the circumstances surrounding the default, writ or Judgment.

Then the credit repairer negotiates with the creditor who initiated the listing on your behalf to remove the default.
This can also often involve lengthy requests and submissions of documentation until an agreement is reached by the creditor and the repairer to remove the offending black mark.

Not every credit file is suitable for credit repair. The credit repair company can review your situation and determine whether your case is worthy of pursuing.

How do I seek out the best firm for repairing my bad credit mistake?

Credit repair with a law firm solely focused on credit law is arguably the safest choice for credit repair in Australia. The process of credit repair is often attempted by companies without a legal practising certificate.

Some of these companies can charge big bucks to perform the service for you. Some in the ‘credit repair’ industry may also claim to give quasi-legal or legal advice without adhering to the restrictions of the law.

A credit reporting lawyer can act in court processes; identify legal issues; provide legal advice; prepare binding agreements; conduct formal negotiations and follow through with enforcement where necessary.

A credit reporting lawyer can also make formal recommendations to Credit Providers making reference to the law, and make representations on behalf of clients.

Click here to find out more about how MyCRA Lawyers can help you with your bad credit mistakes.

29/05/2014
New credit laws: the single best thing you can do to prevent bad credit

Change your attitude towards paying your bills, and change the likelihood you will suffer from bad credit. That is the single best thing you can do to prevent bad credit in the form of defaults, and now, the dreaded late payment notation. It’s not rocket science of course, but changing your financial attitude and stopping the crazy juggling act is one of those things I have seen in my time that most people on the slippery financial slope don’t do, that they could do to get themselves on the road to long term financial recovery long before they have defaults. Without defaults or late payment notations on your credit file, you score much better in the lender’s systems. You have a much better chance at securing credit in the future, including major credit like a home loan.

By Graham Doessel, Non-Legal Director of MyCRA Lawyers www.mycralawyers.com.au.

Although we would like to believe that the credit system is foolproof there are always going to be instances where Credit Providers make mistakes, and you cop bad credit unjustly or incorrectly. That you can’t help. T

he type of bad credit I’m talking about is the bad credit which is directly attributed to you not paying your accounts on time. Instances where it’s either entirely or mostly your fault.

With our new credit laws in place, it is quite likely that at some point most Credit Providers holding an Australian Credit Licence (eg banks and building societies) will sign on to comprehensive credit reporting and be able to access and report on your repayment history. So if you’re late by more than 14 days paying your credit card, personal loan or home loan, you run the risk of having a late payment notation recorded on your credit file and remain there for two years.

A story yesterday from the Brisbane Times, Telcos and utilities could suffer under new credit rules quotes the Australian Retail Credit Association (ARCA)’s Damian Paull. ARCA are the guys that devised the Credit Reporting Code of Conduct, to go with our new Privacy Laws. Mr Paul said there is a danger that banks who chose not to report consumer repayments information and telcos and utilities – which are excluded from the new regime – could find there is a financial impact.

“Once consumers get a sense of who is reporting, what’s going to happen?,” he said.
“If I know bank X is reporting and Bank Y isn’t, what is going to happen to banks who do not report that information? What is going to happen to telcos and utilities?
“Is that going to put pressure on these organisations and their payments – I think this is probably going to happen,” he told a conference organised by Informa in Sydney on Wednesday.

These comments worry me, because it tells me that it is predicted that people who are struggling with their repayments will simply make their loan and credit card repayments on time, but miss the mobile or energy bill, because those are not subject to repayment history.

Whilst this may be true, as someone who has been involved in the finance sector a long time, it is not a sentiment I want to accept.
Fair enough, some months you may be a little short on cash. Yes, to avoid repayment history, you may want to pay your credit card, but leave your phone bill.

But for those people who are consistently unable to meet all of their repayments on time – there was no mention in the article from any of those commenting, of what they should do, to get back on track.

By acting early and taking advantage of new financial hardship laws, you can save yourself from mounting debt, late payment notations and defaults.

If you are suddenly unemployed, fall ill, separate from your spouse or have a period of intense debt stress – you should know there are laws that may be able to help you through this difficult time. By putting your hand up early– before your accounts go into arrears – you could save your credit file. But why are there not more people aware of this?

Time and again, I see people burying their heads in the sand, robbing Peter to pay Paul, until they are in so much debt it slaps them in the face. You should know that a bump in the road doesn’t have to mean you can’t borrow again, so long as you handle it the right way.

New financial hardship laws brought out by the Government last year have been designed to protect consumers during times of temporary financial hardship.

Last year, Steven Münchenberg, Chief Executive of the Australian Bankers Association, said in a statement to the media that only one in four bank customers knew that banks offered hardship assistance.

As a company involved in credit dispute, MyCRA Laywers has helped many clients in the past dispute credit listings issued during a time of financial hardship.

If the powers that be played a more proactive role in credit education, this issue would no longer be as prevalent.

In the past consumers have not been offered hardship variations with their bank, or they have not been aware they have a right to request one and have been defaulted – this locks them out of mainstream credit for five years. If you are largely aware of your rights and obligations, then you might request a variation to your credit agreement early and potentially avoid the long term pain for what is often a very temporary issue.

The earlier you act, the better off you will be. The key word here is ACT. Don’t hide from your Credit Providers and hope it will all go away. It never does.

If you are experiencing temporary financial hardship you contact your bank or building society and ask to speak with the Financial Hardship Variation Team. Using the specific words ‘financial hardship’ will help make it clear to the bank what you need. Ideally, act before you fall into arrears on your account – to save your credit file when you recover from this difficult time.

If you’re not at the point of needing a specific hardship variation with your bank, but you still struggle from time to time – don’t wait till everything goes belly up. There’s plenty of help out there for people who aren’t great juggling their finances or have found themselves over-committed. There are free financial counsellors out there who should be able to help you. Contact the Financial Counsellors of Australia www.fca.org.au for more help.

Image: Danilo Rizzuite/ www.FreeDigitalPhotos.net

23/05/2014
Is the 2014 Federal Budget a mortgage killer?

We look at Tony Abbott and Joe Hockey’s Federal Budget in detail to determine what the possible ramifications could be for those who will buy a home in the future. Whether you agree with the decisions handed down or not, we look at how the choices in ‘Federal Budget 2014’ could impact home buyers both now and in the future. We also look at the possible ramifications for credit expectations and the credit files of those in the firing line.

By Graham Doessel, Non-Legal Director of MyCRA Lawyers www.mycralawyers.com.au.

The property industry has been given a partial reprieve under the Federal Budget 2014, with negative gearing surviving, despite predictions it would be axed. The Government had also said during the Budget announcement that it expected interest rates to remain low in the near future, which is good news for home buyers and mortgage professionals.

But there are still a number of substantial areas in the Budget which cause negative fall out to filter down to Australian home buyers and be felt on the frontline of the mortgage industry, and we examine them.

Changes to unemployment benefits

There has been controversy about the Government’s harsh new rules on unemployment benefits. The unemployed who are 25-30 years old will have to wait 6 months to receive the Newstart Allowance. But despite the damning headlines, the rules aren’t quite as harsh as they appear. If an applicant was previously employed, the waiting time will be reduced one month for every year they had been employed. This means that if someone has legitimately lost a job prior to 6 or more years of work, they will be exempt from the government’s new stipulations.

It sounds like a good plan to boost employment, which could in turn be good for the housing and finance industries, except it seems to leave the potential for many people to be quite disadvantaged.

For those who are forced to wait a month or two before they can receive Newstart, there could still be problems. For instance, how is a 25-30 year old who lives out of home, who perhaps has a family or at least has incurred some level of debt, and who is unable to get work, expected to wait out one or two months, let alone six months with no money coming in – before they receive government help?

If the unemployed person is truly unable to secure work straight away for whatever reason, they are going to end up relying on credit to bridge the gap until they can either find paid work or become eligible for government assistance. Although the idea of making people wait sounds reasonable as an incentive to get “dole bludgers” off the couch and out in to the workforce, in reality the conditions just don’t seem fair for everyone across the board.

It brings to mind a survey I featured back in 2012 from Dun & Bradstreet. Their Credit Expectations Survey revealed at the time that a third of low income earners in Australia would only have been able to survive one month without paid work. What if you’re a low income earner, living in an area of high unemployment?

Furthermore in terms of the housing market – people who go through something like this in their 20’s could be ruined for major credit like a home loan. At best they’ll probably have a credit rap sheet of payday loans and fringe lenders. At worst, they’ll have defaults on their credit file.

Families saving for a home

There has also been a significant reduction in the Family Tax Benefit. The Family Tax Benefit Part B threshold has been reduced to $100,000 and will no longer be available after the recipient’s youngest child turns six. The Family Tax Benefit Part A will begin to reduce once the family’s income exceeds $94,316 per year. The School Kids Bonus will also be cut. Having three children is also no longer considered a “large family” with families of four children the cut-off for eligibility for the large family supplement.

Alongside these cuts, the fuel excise freeze has also gone. This means that fuel prices will rise every six months with inflation.

First home buyers

First Home Buyers, already with historically low numbers in Victoria, will have even less incentive to buy a home following this Federal Budget. There are a number of direct and indirect cuts which will impact them. The first is the scrapping of the First Home Savers Account:

INCENTIVE CUT

First-home buyers saving for a deposit have lost an incentive with the scrapping of the First Home Savers Account (FHSA) in the Budget.

The Rudd government initiative, introduced in 2008, provided people saving for a deposit with tax breaks and co-contributions from the government.

Under the scheme, savers paid concessional tax rates of 15 percent on interest earned in the accounts and the government made a 17 percent co-contribution on the first $6000 contributed each year.

The government co-contributions to the accounts will end on July 1 and tax and social security concessions will be withdrawn from July 2015.

Mr Hockey said the accounts were being abolished because their low popularity.

The Government expects to make $143 million in savings over five years from its scrapping. (news.com.au ‘Federal Budget 2014: Homeowners and the property sector winners’).

In addition to this, the Government has decided not to review the First Home Owner Grant to keep it relative to house price movements, despite calls from the Real Estate Institute of Australia to do so.

Price hikes for Universities

University fees will be de-regulated after 2016 – and this will see a likely increase in University fees across the States. This could also filter through to the first home buyer market. Students will likely come out of their studies with a bigger debt to repay, and less money to save for a home.

There are some key issues for home buyers, particularly first home buyers given their rates are already so low. I believe it will be important to watch how things unfold over time, particularly how the new unemployment system is working. But for the housing industry, I don’t see this budget as being a big a mortgage ‘killer’ – but let’s hope it doesn’t end up hurting a little.

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

The above piece is opinion only and does not constitute legal and or financial advice.

Image: jesadaphorn/www.FreeDigitalPhotos.net

16/05/2014
Protect your credit file campaign fights identity theft

Media Release

‘Protect your credit file’ campaign fights identity theft.

16 May, 2014

As the Attorney-General announces rates have ballooned to 1 in 5 Australians affected by identity theft, a credit reporting advocate is running an awareness campaign aimed at reducing the numbers affected by this terrible crime.

Graham Doessel, who is Non-Legal Director of MyCRA Lawyers, a firm focused on credit disputes, says identity theft can have devastating effects, including damaging the victim’s credit rating.

“Some identity theft victims can wind up banned from mainstream credit for years because a fraudster has stolen their good name,” Mr Doessel says.

This comes as a result of an Australian Institute of Criminology survey which revealed that 20.7 per cent of those surveyed had experienced identity theft at some time. 14 per cent were also refused credit following the event and 5 per cent had to commence legal action to clear debts and/or their name.

Mr Doessel says when fraudsters assume someone else’s identity they can leave a trail of destruction on their credit file.

“Fraudsters are never so kind as to pay the credit back. Defaults can then mount on the victim’s credit rating and ruin the victim’s ability to obtain credit in their own right,” he says.

Mr Doessel says there are 10 identity theft prevention tips to be aware of:

1. Install automatic software updates on your computer and perform regular scans.

2.       Change passwords regularly and use a variety of passwords.

3.       Keep your privacy settings secure on all sites you use.

4.       Subscribe to the government’s ‘Stay Smart Online’ alerts for computer security updates.

5.       Check your credit card and bank statements each time they come in for strange activity.

6.       Shred all personally identifiable information which you no longer need.

7.       Buy a safe for your personal information at home, and a lock for your mailbox.

8.       Be aware of who gets your personal information and for what purposes. For instance, is it really necessary for the site you are registering on to store your date of birth?

9. Visit the ACCC’s ‘SCAMwatch’ website for updates.

10.   Check your credit file regularly.

MyCRA Lawyers is encouraging all consumers to check their credit file to make sure it is as it should be. You can do this for free through www.freecreditrating.com.au once per year.

“We feel so passionately about credit file awareness, and want to promote how important a credit check is to preventing identity theft and all other credit rating inconsistencies,” Mr Doessel says.

He says during their ‘protect your credit file campaign’ (which began last week during Privacy Awareness Week, and runs through the month of May 2014), MyCRA Lawyers is giving away up to 50 personal shredders to their new clients. (Conditions apply, see website www.mycralawyers.com.au for full details).

“Personal information is so important to protect, and one of the simple ways we can help our clients avoid identity theft is by promoting the shredding of personal documents they no longer need,” 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 www.mycralawyers.com.au/mediacentre

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.

http://aic.gov.au/publications/current%20series/rpp/121-140/rpp128/07_results.html

Image: Chris Sharp/ www.FreeDigitalPhotos.net

16/05/2014
Privacy Awareness Week 2014: Protecting the Privacy of Your Customers

There has never been a more important time in business to consider the privacy of your customers. Personal information is more accessible than ever before, and with that, comes the need to create and define boundaries around personal information in the private sector. New laws have just been implemented which expand the scope of privacy law in Australia. This it seems is not merely being ‘over-cautious’ with privacy. A recent survey on identity crime shows it has officially become one of the more common crimes in Australia. Results from a survey of 5,000 Australians on their experiences of identity crime and misuse conducted by the Australian Institute of Criminology (AIC) on behalf of the Attorney-General suggest identity crime directly affects around 1 million Australians each year.

The survey has found almost 1 in 10 people experienced misuse of their personal information in the previous 12 months, and 1 in 5 people experienced misuse of their personal information at some point in their lives, with 5% of people experiencing identity crime or misuse resulting in a financial loss in the previous 12 months. Identity theft can impact the finances and the credit rating of victims. If your business handles personal information, this Privacy Awareness Week 2014, with its emphasis on education of Australia’s new Privacy Laws, is a good time to ensure you are meeting your responsibilities to consumers and to your business around Privacy, particularly if your business has obligations under the Privacy Act 1988 (Cth).

By Graham Doessel, Non-Legal Director of MyCRA Lawyers www.mycralawyers.com.au.

With the emphasis on privacy protection in Australia’s new Privacy Laws, businesses which handle personal information are required to update their Privacy Policies and possibly their systems to fall in line with new changes. Under the new privacy law the IPPs and NPPs has been replaced by the new, unified, Australian Privacy Principles (APPs) – these will apply to businesses with a turnover of at least $3 million, as well as government agencies. This is just one of the many significant changes to the Privacy Act 1988 (Cth).

The Federal body which handles Privacy in Australia, the Office of the Australian Information Commissioner (OAIC) has previously suggested some basic questions for businesses to prompt further investigation if necessary into possibly obligations under the Privacy Act 1988 (Cth).

• Does your business or agency handle personal information? There are some changes to what constitutes personal information under the Privacy Act

• Do you need to review your business or agency’s privacy policy? You should have an up-to-date policy that is reviewed regularly. The new laws set out some requirements for privacy policies

• Do you need to review your business or agency’s outsourcing arrangements? You will need to do this particularly if you are sending personal information overseas.

• Do you use direct marketing to reach your customers? If you do, you will need to provide an easy way for people to opt-out of receiving these communications. There are some new rules in the area of direct marketing

• Does your business or agency receive unsolicited personal information. There are some new rules on how to handle this information

• Do your information security systems need to be reviewed and updated?

On Monday, the OAIC launched ‘A guide to developing an APP privacy policy’ to assist organisations and agencies meet this challenge. The Guide sets out a step-by-step process for developing privacy policies and a helpful checklist. There are also a number of tips to ensure that privacy policies are accessible and clearly expressed.

The OAIC also launched ‘A revised Guide to undertaking privacy impact assessments.’ A Privacy Impact Assessment (PIA) is an assessment tool that ‘tells the story’ of a project from a privacy perspective. PIAs analyse the possible privacy impacts on individuals’ privacy and recommend options of managing, minimising or removing these impacts. PIAs are one way of building an organisational culture that respects privacy while also minimising the risk of data breach which can result in reputational damage and a range of other costs.

What else can businesses do to ensure it is creating a culture of respect for Privacy of its customers?

Privacy and your business

Good privacy practice is important for more than just ensuring compliance with the requirements of the Privacy Act. If an entity mishandles the personal information of its clients or customers, it can cause a loss of trust and considerable harm to the entity’s reputation. Additionally, if personal information that is essential to an entity’s activities is lost or altered, it can have a serious impact on the entity’s capacity to perform its functions or activities.

It is important for entities to integrate privacy into their risk management strategies. Robust information-handling policies, including a privacy policy and data-breach response plan, can assist an entity to embed good information handling practices and to respond effectively in the event that personal information is misused, lost or accessed, used, modified or disclosed without authorisation. (OAIC Guide to Information Security)

There is a large amount of help in the OAIC’s Privacy Business resources section on their website, including a Privacy checklist for small businesses.

It is important businesses don’t leave privacy to chance. Possible ramifications of not protecting personal information can be that customers are left embarrassed, distressed, or potentially financially affected. In the case of identity theft, where personal information is used to assume the identity of the victim, there is a grave potential for credit to be taken out in the vicitm’s name. Their credit rating can be destroyed for 5 to 7 years due to defaults they haven’t actually incurred themselves. Click here to find out more about the ramifications of identity theft on the credit rating. (Article courtesy of MyCRA Credit Repair).

Under the amended laws, the Privacy Commissioner has been given enhanced powers to conduct assessments of privacy performance for government agencies and businesses, as well as the ability to accept enforceable undertakings and importantly, to seek civil penalties in the case of serious or repeated breaches of privacy.

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.

MyCRA Lawyers is a proud partner for Privacy Awareness Week 2014.

Link to see more on the AIC Survey on Identity Theft and Misuse in Australia

Image 1: pakorn/ www.FreeDigitalPhotos.net

Image 2: Stuart Miles/ www.FreeDigitalPhotos.net

08/05/2014
Privacy Awareness Week 2014: New Privacy Laws and You

MyCRA Lawyers is a proud partner for Privacy Awareness Week (PAW), held 4-10 May 2014. Privacy Awareness Week is held every year to promote awareness of privacy issues and the importance of the protection of personal information. This year is focused on our new Australian Privacy Laws, which came into force on 12 March 2014. Find out about how Privacy Laws may affect you and your credit rating, this week during PAW.

By Graham Doessel, Non-Legal Director of MyCRA Lawyers www.mycralawyers.com.au.

In an age of increasing accessibility of personal information, privacy is growing ever more important, and more valued for Australians. According to a recent survey by the Office of the Australian Information Commissioner (the federal Australian Government body responsible for privacy in Australia), a third of Australians reported they had a privacy problem in the last year. In addition, 60% of Australians decided not to deal with a private business and 25% have decided not to deal with a government agency due to concerns as to how their personal information will be used.

Australia’s new privacy laws were the most significant changes to privacy laws in over 25 years, affecting a large section of the community. The changes to the Privacy Act 1988 include a new set of Australian Privacy Principles that regulate how your personal information is handled and new enforcement powers for the Office of the Information Commissioner (OAIC).

One of the aims of the new privacy laws is to ensure that your personal information is managed in an open and transparent way.

Here are some tips provided by the OAIC during PAW, to help you protect your personal information:

• Know your privacy rights

• Read privacy policies and notices

• Always ask why, how and who — this will help you to know how your personal information is going to be used, and if it is going to be given to another agency or organisation

• Only give out as much personal information as you need to — always think before handing your personal information over

• Ask for access to your personal information

• Make sure the information an organisation or agency holds about you is accurate and up to date

• Take steps to protect your online privacy

• Make sure your hard copy records are properly destroyed

• You can ‘opt out’ of marketing communications if you do not want to receive any further contact of this kind

• Make a privacy complaint if you consider that your personal information has not been handled properly.

Many identity theft cases that impact your credit rating could have been prevented with better education and more vigilance around the protection of personal information. Complacency around personal information, both on the part of consumers and entities such as agencies and businesses, can be the undoing of someone’s ability to obtain credit.

Pieces of personal information are the building blocks for credit file misuse. You can lose your personal information to fraudsters in many ways, and you may be unaware of how or when it has occurred – particularly if it has happened via malware, through data breaches or even through too much sharing online.

Sometimes it’s not until you apply for credit and are refused that you even find out you have been exposed to identity fraud, and by then it may be too late to detect how it took place.

This is why it is so important for all Australians to educate themselves on how to keep their information secure, and to demand that any information they are required to give over to any person or company be treated with the utmost privacy. Australia’s new Privacy Laws will hopefully add the requirements for all entities holding our personal information to be more aware of and accountable for upholding personal information privacy.

You can find out about your rights in more detail through the OAIC’s Privacy factsheet ‘How changes to privacy law affect you.’

THIS PAW WEEK: If you have a business, get some help in our next post with how to navigate the new privacy laws, including how to update your Privacy Policy, and how and when to conduct a Privacy Impact Assessment. For consumers and businesses alike, also stay tuned this week for how Australia’s new Privacy Laws may impact your ability to obtain credit, through changes to credit reporting laws.

07/05/2014
Beware guarantor loans for desperate first home buyers

Media Release

Beware guarantor loans for desperate first home buyers.

24 April 2014

First home buyers desperate to get a foothold in the property market are receiving financial help from Mum and Dad or other family members at increasing rates through family guaranteed loans, but a consumer advocate warns there is no financial benefit for the guarantor, and significant credit rating risks.

Graham Doessel, Non Legal Director of MyCRA Lawyers, a firm focused on credit disputes, says the difficulties people face entering the property market has sparked an increase in guaranteed loans, where the equity of a property owned by parents or other family is used as collateral.

But Mr Doessel says many people may not be aware of the significant risks involved in this type of loan, which is being offered in some form by most lenders.

“Most people don’t know that family guaranteed loans can be dangerous for your credit rating, because your credit history is then linked with the credit rating of your child or other family member, despite having no claim to the property, and little control over the outcome of repayments,” he warns.

Mr Doessel says in most arrangements, if for some reason repayments are not met, both sides are liable for the debt, and both may be defaulted.

“Unfortunately the guaranteeing party may not be aware the loan is or was in default until such time as they attempt to take out credit for themselves and are refused,” Mr Doessel says.

He adds that new repayment history information being recorded on consumer credit files means loan repayments must be made on time or possibly face a ‘late payment’ notation against your name.

“These late payment notations could impact your ability to get credit for two years,” he says.

Otto Dargan, director of Home Loan Experts recently explained the rise in guaranteed loans to Mortgage Professional Australia (MPA):

“Guarantor loans are now the only product that allows a first homebuyer with no deposit to buy a home and as a result, their popularity has increased,” he told MPA.(1)

A survey conducted last year from ING Direct revealed that 32% of first home buyers in Australia receive financial assistance from family to put their housing finances on a firmer footing.(2)

“The challenge of getting on the housing ladder has inspired a growing trend for first home buyers to obtain financial assistance in order to get the keys to their first property,” ING stated.

Mr Doessel says a negative entry on a person’s credit report will mean it is difficult to get credit. He says defaults impact the ability to obtain credit for 5 years. In severe cases of delinquency, the guarantor’s own home is called upon.

“In cases of significant arrears, the bank begins to use the guarantor’s property to recover lost debts,” he says.

He suggests parents or family guaranteeing a loan should sit down and ask some tough questions before committing.

“The most important question anyone contemplating guaranteeing a loan should be asking is ‘could we make the repayments should our child or family member be unable to?’ If in doubt, don’t risk it,” Mr Doessel says.

He says it is vital to make these considerations:

1. Seek outside independant and or legal advice prior to any agreement being made.

2. Insist there is adequate protection to cover anything that may go wrong during the term of the loan, such as life or income protection.

3. Set a specific amount that will be guaranteed.

4. Ensure there is an ending to the time period of the guarantee.

5. Request a duplicate copy of all bank statements sent during the course of the guarantee. This way, payment problems can be addressed prior to any defaults, while your good credit rating is still intact.

“Get in and do your research about alternatives to a guaranteed loan before you agree. As a parent or family member you may find you can help your first home buyer in other ways without risking your good credit rating to do it,” Mr Doessel says.

/ENDS

Please contact:

Graham Doessel – Non-Legal Director Ph 07 3124 7133

Lisa Brewster – Media Relations media@mycralawyers.com.au

http://mycralawyers.com.au/ www.mycralawyers.com.au/blog

MyCRA Lawyers 246 Stafford Road, STAFFORD QLD. Office 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.

(1) http://www.homeloanexperts.com.au/wp-content/uploads/2009/09/Otto-MPA-Guarantor-Article.pdf

(2) http://blog.ingdirect.com.au/2013/01/02/is-housing-expensive-66-of-australians-say-yes/

Image: Ambro/ www.FreeDigitalPhotos.net

24/04/2014
Critical internet security information: bug ‘Heartbleed’

Is your website or online service running OpenSSL? Or are you an internet user who gives out personal details or uses services within OpenSSL? Then your security may be at risk. According to internet security experts ‘Heartbleed’ is a major vulnerability in common encryption software which is affecting many websites and online services. Heartbleed is so widespread it could leave millions of servers on the internet open to an attack and could allow sensitive data including usernames and passwords to be stolen. We look more at this vulnerability, what you can do about it, and what the risks are when personal and financial information has been stolen, especially for the affected person’s credit rating.

By Graham Doessel, Non-Legal Director MyCRA Lawyers www.mycralawyers.com.au.

The bug

The Government’s Stay Smart Online (SSO) website has issued a HIGH priority security bulletin for those websites and online services running OpenSSL due to a major security vulnerability which has been discovered:

The OpenSSL vulnerability is reported to have been around since 2011. Following recent publicity, there is growing evidence that websites are being targeted using this vulnerability.

According to SSO, around two-thirds of websites and many other services currently use affected versions of OpenSSL (which stands for Open Secure Socket Layer, the most common cryptographic software used on most web servers). You would recognise websites using OpenSSL by the small padlock icon in the browser address bar or the ‘s’ added to the ‘http’ prefix for web addresses.

There is an official webpage for this bug, and I encourage all to read the webpage, and seek help in this area if necessary. It advises that unlike bugs in single software or library which are able to be fixed by new versions, this bug is more dangerous because it has left a large amount of private keys and other secrets exposed to the Internet. Considering the long exposure, ease of exploitation and attacks leaving no trace this exposure should be taken seriously.

Heartbleed.com explains in more detail what the bug does:

The Heartbleed bug allows anyone on the Internet to read the memory of the systems protected by the vulnerable versions of the OpenSSL software. This compromises the secret keys used to identify the service providers and to encrypt the traffic, the names and passwords of the users and the actual content. This allows attackers to eavesdrop on communications, steal data directly from the services and users and to impersonate services and users.

The even scarier part of this vulnerability, is that if there had been someone hacking information, they would leave no trace of attack.

Who is at risk

OpenSSL is the most popular open source cryptographic library and TLS (transport layer security) implementation used to encrypt traffic on the Internet.

According to Heartbleed.com:

Your popular social site, your company’s site, commerce site, hobby site, site you install software from or even sites run by your government might be using vulnerable OpenSSL. Many of online services use TLS to both to identify themselves to you and to protect your privacy and transactions. You might have networked appliances with logins secured by this buggy implementation of the TLS. Furthermore you might have client side software on your computer that could expose the data from your computer if you connect to compromised services.

How widespread is this?

The most notable software using OpenSSL are the open source web servers like Apache and nginx. The combined market share of just those two out of the active sites on the Internet was over 66% according to Netcraft’s April 2014 Web Server Survey. Furthermore OpenSSL is used to protect for example email servers (SMTP, POP and IMAP protocols), chat servers (XMPP protocol), virtual private networks (SSL VPNs), network appliances and wide variety of client side software. Fortunately many large consumer sites are saved by their conservative choice of SSL/TLS termination equipment and software. Ironically smaller and more progressive services or those who have upgraded to latest and best encryption will be affected most. Furthermore OpenSSL is very popular in client software and somewhat popular in networked appliances which have most inertia in getting updates.

Affected versions of the OpenSSL

Status of different versions:

•OpenSSL 1.0.1 through 1.0.1f (inclusive) are vulnerable

•OpenSSL 1.0.1g is NOT vulnerable

•OpenSSL 1.0.0 branch is NOT vulnerable

•OpenSSL 0.9.8 branch is NOT vulnerable

Bug was introduced to OpenSSL in December 2011 and has been out in the wild since OpenSSL release 1.0.1 on 14th of March 2012. OpenSSL 1.0.1g released on 7th of April 2014 fixes the bug.

In Australian Broker on Wednesday, Deloitte security, privacy and resilience head Anu Nayer said it is vital for businesses who run a website or online service that the company’s technical team knows all the websites and web services the organisation has so they can check all the necessary sites. He outlined some important questions to determine your level of risk:

•How have you determined whether each of our websites and web services has OpenSSL service enabled?

•What type of sensitive information do we have that is accessible from the internet? What type of information would have been at risk?

•Have we looked at our logs to determine if there have been any successful or unsuccessful attempts to exploit this issue? What did we find? Are we monitoring our network to look for indications of attacks?

•What steps have we taken to mitigate the issue?

•How have you confirmed that the fixes have been applied successfully?

•Have you got assurances from our vendors, external hosting providers and application cloud services that they have fixed any vulnerable systems?

The risks

Obviously the information being shared in OpenSSL is of a secure nature for one reason or another, so someone with access to this information could do a whole host of things, including make use of, or on-sell information to fraudsters, cyber-terrorists or spammers.

They can also use the information to commit identity theft – the fastest growing crime in Australia.

Information like dates of birth, account numbers, full names and other personal information can be used to steal your identity and take credit out in your name. Fraudsters have been known to go so far as to take out personal loans, credit cards and even mortgage homes in their victim’s name. Unfortunately fraudsters are never so kind as to pay this credit back – which leads to defaults on your credit rating. Most victims are unaware of this until they apply for credit in their own right and are flat out refused.

Defaults remain on the credit file of individuals for between 5 and 7 years. Often not much of a trail is left and prosecutions don’t come easily.

The fix

Open SSL 1.0.1g or newer should be used.

If this is not possible software developers can recompile OpenSSL with the handshake removed from the code by compile time option -DOPENSSL_NO_HEARTBEATS

Nayer says for organisations, it would also pay to consider if it is appropriate to revoke any Certificates which were used while the organisation ran exposed versions of OpenSSL.

“Even after a fix is applied, the private cryptographic keys your systems are relying on to protect their communications could already have been compromised and this fix won’t address that compromise,” he said.

For consumers, changing passwords regularly may help, and in addition a regular credit check can ensure you aren’t vulnerable to identity theft. Look for changes in personal details as well as suspicious credit enquiries in your name as a first sign of identity theft.

Image: joesive47/ www.FreeDigitalPhotos.net

17/04/2014
Late payment grace period extended to 14 days

An application by the Australian Retail Credit Association (ARCA) to extend the 5 day ‘grace period’ to 14 days for late payment information on credit reports was approved by the Information Commissioner late last week. The amendment to the Credit Reporting Privacy (CR) Code will mean consumers will have more time to pay their credit card or loan account before they cop the new type of bad credit a ‘late payment’ notation. We look at the details of this important change and what this means for you and your credit rating.

By Graham Doessel Non-Legal Director of MyCRA Lawyers

Since 12 March 2014, Australian credit reports can include a range of new information available to lenders, including repayment history information. Up until last week, repayment history information could be recorded on licenced credit account which was more than 5 days late.

But following widespread concern across the community that a 5 day grace period was not long enough to ensure simple forgetfulness or mistakes didn’t see consumers hit with a black mark on their credit report, Attorney-General, George Brandis requested a change. ARCA submitted an amendment to Office of the Information Commissioner (OAIC) to extend the grace period to 14 days, which was approved last week. Consumer advocates (including myself) had argued that the original 5 days late was not long enough to indicate significant credit risk.

“Given the concerns raised by the community and reflected by the Attorney General on this matter, we agree that a 14 day grace period is an appropriate compromise before a late payment is recorded as Repayment History Information,” ARCA CEO Damian Paull stated in a media release after making the submission to the OAIC.

He says Repayment History Information helps improve the accuracy of predicting the credit risk of consumers, and consumers need to understand the difference between late payments and defaults.

“One late payment on your credit report is less serious than a default. Any of us can be on holidays or forgetful, and a late payment can be offset by an overall positive history of paying most accounts on time. Defaults on the other hand are always more serious,” he said.

I am encouraged that the grace period has been extended to 14 days, and I understand that one late payment on a consumer’s credit report should be much less serious than a default. But at the same time, I fail to see how exactly consumers are meant to understand the differences between a late payment and a default.

We know the process of assessing credit worthiness is a matter for each lender to determine and given this, consumers have been given no information or examples from lenders in which to garner any understanding on the differences between how a default and a late payment will be treated.

As someone experienced with seeing the effects of bad credit, I can only make assumptions based on how most mainstream lenders have treated other ‘black marks’ on credit reports. In the past, a client with a default has most often been refused credit with mainstream lenders, too many credit enquiries on the client’s credit report within a certain time frame has also in the past meant credit refusal. Consumers with these black marks who have not been out and out refused credit have alternatively been offered a higher interest rate than someone with a clean credit file.

I predict that late payment notations will probably be treated the same way. A certain number within a certain time frame could mean credit refusal, a certain number could also mean a higher interest rate for the prospective borrower. So what’s the magic number? I guess we’ll have to wait and see.

Image: David Castillo Dominici/ www.FreeDigitalPhotos.net

09/04/2014
6 Tips For a Clean Credit File

Currently, we are seeing lots of people running into trouble with their credit rating. If you end up in trouble with a default on your credit file, it sticks for 5 years and can be a real thorn in your side when you go to apply for credit again. With new laws now in place from March 12 – repayments on accounts such as credit cards and loans made more than 5 days late may see you end up with a notation against your name for 2 years. It’s heavy stuff. We look at what you can do to stay savvy with credit now and in the future, and make it work for you!

By Graham Doessel, Non-Legal Director of MyCRA Lawyers www.mycralawyers.com.au.

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 earned. 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, not having a credit rating in this day and age can be just as difficult as having a bad credit rating.

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 realising the consequences.

Credit can be wonderful provided you maximise it to suit 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.

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 be very detrimental to your ability to gain further credit. 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 show up as being paid can be enough for a declined home loan approval in the future. It is extremely important to keep a clear credit file because the repercussions will be felt for 5 years.

You also need to be organised to ensure you avoid the dreaded late payment notation against your name. Too many of those could be just as detrimental to getting a loan as a default would be.

There is no time like the present to start making credit work for you.

Begin by checking your credit file – which you are entitled to do for free every 12 months via the major credit reporting agencies Equifax (Formerly 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.

Here are some 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. Positive repayment history on loans and credit card accounts may also help to boost your credit score after March 2014.

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 or in the case of licenced credit, a late payment notation.

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. CHECK CREDIT FILE REGULARLY: You should check your 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.

6. DON’T LEAVE DEFAULTS TOO LATE: If there are defaults, don’t put up with them for 5 years. To find out more about removing/disputing a credit listing you don’t agree with, contact us here at MyCRA Lawyers on 1300 667 218.

Image: Stuart Miles/ www.FreeDigitalPhotos.net

06/04/2014
Credit reporting in Australia your questions answered on bad credit

Australia has just undergone a major credit reporting change. If you don’t know much about credit reporting, then you could be at risk of messing up your credit rating. Yesterday, we answered your basic questions on credit reporting. Today we answer more of your questions on bad credit and what to do about it. Find out what you may not know about credit in Australia.

By Graham Doessel, Non-Legal Director of MyCRA Lawyers www.mycralawyers.com.au.

I have paid my credit card bill late, what are the consequences of this?

Accounts like your credit card, your personal loan, your mortgage or your car loan are provided by ‘licenced’ credit providers. These providers are required to hold an Australian Credit Licence. They are also able to record and access repayment history information, include late payment history. If you are more than 5 days behind in your repayments it could be noted on your credit file. So in a nutshell, if your credit provider has previously informed you that it will be collecting repayment history, expect that notation to show up against your name, including the date the account was paid. This information will stay on your credit file for 2 years. It is unclear what the consequences of one late payment notation will be. Certainly it has been said that several late payment notations will impact your ability to obtain credit.

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 credit file. This will probably prevent you from obtaining a home loan with most lenders and possibly lead to credit refusal of many kinds from loans right through to phone plans. A default is not removed unless it can be shown it was placed in error on your credit file or was placed unlawfully.

A record of good repayment history information may ease the severity of having a default on your credit file, but as defaults are not removed for 5 years, there is no guarantee you will be granted approval. You may also be offered a higher interest rate while the default is on your credit file.

What can I do if there’s something I don’t agree with on my credit file?

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

If you don’t agree with a credit listing that has been placed by your credit provider, and you want to dispute it, the new laws allow you to ask the credit reporting body which holds your credit file to note a dispute against it.

Some people choose to go through the process of disputing their own credit listing, and other people prefer to leave it to a third party. Both options are there. Often it depends on a) how savvy you are b) how much time you have c) how complicated the process of dispute is going to be.

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 not be sufficient to ensure credit is obtained with some lenders.

If you are looking at choosing a third party to dispute your credit listing, make sure you choose wisely. You can contact the Credit Repair Industry Association of Australasia (CRIAA) for help with selecting a reputable and ethical credit repairer.

MyCRA Lawyers is a firm focused primarily on credit disputes. Not only can we work to repair and remove your bad credit by disputing your credit listing, we can also work on your behalf in legal matters as they arise (which they frequently can).

Images: Stuart Miles/ www.FreeDigitalPhotos.net

04/04/2014
Credit reporting in Australia – your questions answered

There are some credit reporting changes just arrived which may affect you and your ability to get a home loan, a car loan or any other type of credit. Obtaining credit in Australia may be a little different from now on, as since March 12 Australia has stepped into a comprehensive credit reporting regime. We feel it’s important to educate consumers about credit in Australia, so we look at the credit file basics, and what you should know about taking on credit in Australia.

By Graham Doessel, Non-Legal Director of MyCRA Lawyers www.mycralawyers.com.au

We answer your basic questions about credit reporting in Australia…

What is my credit rating?

Your credit rating is a file on your credit history and is collated by the major credit reporting agencies if you have ever been credit-active. Your credit rating is then checked by any financial institution or credit provider and is used to assess both the amount you are able to borrow and your ability to repay the loan.

What does ‘credit active’ mean?

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

What is defined as a ‘bad’ credit rating?

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

In this current economic climate, basic defaults and even too many credit enquiries or applications for credit may be considered to be tarnishing your credit rating. Your repayment history may also be considered ‘bad’ credit if you have too many late payment notations against your name.

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

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

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

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

What is not realised by many people is how easy it is to have a default slapped on your credit file. If a bill of $150 is more than 60 days late (including rates, power, and mobile phone bills) then a credit provider has the right to notify you of their intention to record this default on your credit file. Even if the account is paid and noted on your file, this default usually remains on your record for 5 years.

In addition to this, if you are more than 5 days late repaying your credit card or loan account – you may also have a late payment notation recorded against your name.

To find out more about credit reporting, you can visit our main site www.MyCRA Lawyers.com.au

If you want to know more about bad credit, look out for our next post where we answer common questions about bad credit, and what you can do if you wish to dispute an adverse credit listing.

Image: Pong/ www.FreeDigitalPhotos.net

03/04/2014
How your credit rating can be damaged when you move.

Did you know, that every time you move house, you run the risk of damaging your credit rating? It happens if loose ends are not tied up on your credit accounts before you leave your old address. We look at some ways you can make sure you don’t risk your good credit rating, and ability to get a loan in the future when moving house.

By Graham Doessel Founder and Non-Legal Director of MyCRA Lawyers www.mycralawyers.com.au.

Moving is a time of stress and chaos. All of your important stuff is boxed up and in transit. You’re flat out cleaning the old place on time, let alone tending to those financial loose ends. But to maintain the integrity of your credit rating, it is really important that you have a plan for making a clean break at each residence.

Time and again we have the situation where clients apply for a home loan and are refused because they have ‘surprise bad credit’, which when we track it back for them is due to the fallout of accounts sent to their previous address. This may not always be your fault.

We have had plenty of clients who’ve needed help disputing their credit listing, because their Energy Provider could not work out that cancellation of their old account and installation at the new address meant that they had actually moved. Their final account was sent to their old address because they had not specifically provided a forwarding address.

Not notifying your Credit Provider of your new address when you move can lead to a Serious Credit Infringement or ‘clear-out’ listing being placed on your credit file. This listing is, as the name suggests, much more serious than a default.

What is a Serious Credit Infringement (SCI)?

A serious credit infringement is an overdue debt in which the Credit Provider has been unable to contact the individual for 6 months following the overdue debt, despite reasonable attempts by the Credit Provider to do so. A SCI is listed on your credit file for 7 years. If contact is made within that time, and the overdue debt is paid, the listing is then downgraded to a default, which carries only a 5 year term.

To avoid this, here are 5 tips for keeping your credit rating in check when moving house:

1. Let all your Credit Providers know you will be moving and give them a forwarding address.

You are obliged to update your Credit Providers with your forwarding address when you move. When you make that call to your Credit Provider, be sure to make a note of the day, time and person you spoke to about the request.

Often we have people say they have told their telco or their energy company they are moving, and provided a forwarding address, but mail has still gone amiss and the client has ended up paying for it. If you have specific details of your call – the Creditor may be able to bring up the recording and verify your request.

2. If ending an account with a Provider, request a final account.

If you need to cancel your account, such as an Energy or home phone account when you move, make sure you request a final account for services. There may be incidental charges, or pay out fees as well as days accrued in the new bill period. Pay that notice as soon as possible.

3. Don’t assume your account is finalised until you get it in writing.

Once you have paid your final account, request a statement be sent in writing verifying the account is at an end. If you don’t receive that notice, chase it up.

4. Cancel any direct debits.

Places such as gyms and childcare centres operate payments via a separate direct debit company. If you have any direct debits set up, you should notify the company of the cancellation and of your forwarding address.

Don’t assume correspondence with your gym is enough to cancel that account. You will have signed a separate contract with the direct debit company, and you are just as obligated to them if you have missed payments, for whatever reason.

5. Redirect mail.

Despite providing a forwarding address, and despite your attempts to finalise your accounts, there can be instances where a Credit Provider continues to send mail to your old address.

Creditors can and do make mistakes, and one common mistake is simple computer or human error with billing systems. To prevent their oversight from costing you your good name through bad credit, consider redirecting mail through Australia Post to your new address.

If you have just found out you have bad credit, there are many circumstances where you may be able to successfully dispute the credit listing. For help to dispute your default or Clear-Out listing, contact MyCRA Lawyers on 1300 667 218.

Image: Ambro/www.FreeDigitalPhotos.net

27/03/2014
New Year, New home? The credit info Australians need to know.

Many a New Year’s resolution has been declared to take the time to find a home this year, and apply for a loan. If this is you, there are some things you need to know about credit NOW which can help you out massively.

We look at the three things you need to ask yourself right now, that you may not have considered, but which could stop you from getting your dream home.

By Graham Doessel, Non-Legal Director of MyCRA Lawyers. www.mycralawyers.com.au.

Good deposit? Check.

Good income? Check

Paid off most of your debts? Check

Stable job? Check.

Most people who answer ‘yes’ to all of the above questions would assume they’re ready to go for finance and would be any lender’s favourite customer.

If this is you, and you are about to talk to your broker or bank branch about getting a mortgage, there are 3 important questions you need to ask yourself before you do…

1. Have I… disputed a bill with my credit provider/moved/divorced or separated/forgotten a bill/or not received a bill I should have in the last 5 years?

These are probably the most common reasons people end up with a bad credit rating which sees them refused a home loan. Answering yes to any of these questions may mean you are at risk of having impaired credit show up when a lender does a credit check on you.

Your credit provider may have issued a default in your name. If you have moved or separated or due to credit provider error, you may or may not have been made aware of your credit listing. These “oversights” whether yours or theirs may not be easy to remove, and many times clients who request their removal are told by their credit provider they are never removed but can be marked as paid if you settle the account. Unfortunately a paid listing is just as detrimental to your home loan as an unpaid one.

If you fall into the above categories, do yourself a favour and apply to see your credit report before you apply for a home loan (www.freecreditrating.com.au).

2. Do I have a copy of my credit report?

Even if you believe you are not at risk of bad credit, and you always pay bills on time, mistakes can and do happen. Don’t let the lender be the one to see them first, order your own credit report and make sure you have the all clear before you apply. If the lender does a credit check they will generate a “credit enquiry” on your file. If you have bad credit, the credit enquiry will only add to the crosses against your name. So it’s best to check your credit file yourself first, which you have the right to do for free annually without generating an enquiry against your name.

You can order your credit report from Australia’s credit reporting agencies. A free credit report takes around 10 working days to be sent to you by mail. MyCRA Lawyers also offers a credit file analysis service, which includes a credit assessment and same-day copy of your credit file service.

3. Have I paid my credit card or any loan late in the last 12 months?

Hopefully you have checked your credit report and it has come back clear…BUT even still, there may be things you are doing right now which are harming your future credit file. If you have been late making repayments to finance providers on accounts such as credit cards or loans you have been monitored (since December 2012). While this information doesn’t show up on your credit file yet, it will from March due to new credit reporting laws which are set to be implemented then. It will stay on your credit file for 2 years.

If you think you have paid a credit card late, or your personal loan or other finance, then you may be at risk of a late payment notation against your name. If you are a serial late payer, even by a week or so, you are probably at risk of this new type of ‘bad credit’.

Too many may mean you are refused credit after March. If you think this is you, you may need to apply for that loan before March, and not wait, or potentially risk being refused credit, or being offered a higher interest rate.

It’s unclear how lenders will look at these notations – how many late payment notations will be too many and mean you’re refused credit, so take heed, and make sure you stop paying your credit accounts late in the future to protect your credit file.

If you’re not sure where you stand with your credit file, or if there is a ‘black mark’ which will stop you from getting your home loan, talk to us about it. We can assess whether we may be able to help you dispute your credit listing. If successful in proving the credit listing is incorrect or inaccurate, it is required to be removed from your credit file. So you can have the squeaky clean credit file you deserve, and your loan at the interest rates you deserve too. Phone MyCRA Lawyers on 1300 667 218 for more information.

Image: Danilo Rizzuti/ www.FreeDigitalPhotos.net

15/01/2014