MyCRA Specialist Credit Repair Lawyers

Tag: credit report

  • Are you ready to buy a home? Read this first

    Saving for a home? We tell you what you might need to know to put you in the best position to get the best loan out there for you. We show you what the lenders might be looking for, and how they calculate risk by looking at your credit history.

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

    In the 21st Century, being approved for a mortgage is a complicated affair. Not only are savings, income and debt level all taken into consideration, but also how your credit rating appears. It is all about risk calculation. The lender is gauging the likelihood you will default on your repayments. Banks have tightened their belts in the wake of the global financial crisis, so risk assessment plays a big part in home loan approval.

    8 things you need to know before you apply for a home loan

    The first three on the list are generally viewed together. The trifecta of savings, income and debts….

    1. Savings.

    Many people are saving 5-10% deposit prior to applying for a home loan. In many areas of Australia houses are so expensive this can take years to achieve. In fact, it was revealed in The Australian newspaper last month, it takes the average first home buyer in Australia a long five years to save up enough deposit for a home.

    In the same paper today in the story ‘Savings the key to first home – survey’ we see that most buyers are in fact saving up to 10% deposit before entering the market:

    RAMS head of brand and marketing Chris Thornton said first home buyers appeared to be saving more now for a deposit than in previous years.
    “A few years ago deposits were around five per cent for the average first homebuyer, and now it’s often more than 10 per cent that people are saving for,” he said.

    “People are really very serious about saving before they jump in.
    “In the past, people have really squeezed themselves to get over the line, but now, they’re just being a bit more cautious.”
    Living with parents and using high-interest savings accounts appeared to be key in the savings process, Mr Thornton said.

    If your income isn’t high or if you have more debts you may actually require a higher deposit of say 10% to ensure approval.

    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 have a lower income, it may be worth paying off existing debts before applying for a home loan. Also, the more deposit you have saved, the lower the income requirements on the same loan.

    According to Homeloanfinder.com.au in its article ‘How Much Salary Should You Have for a Home Loan,’ lenders use two different formulas to determine how much people can borrow:

    1. Front end ratio. “The front end ratio method will determine how much of your income will be used on the repayments of the home loan. Most people will agree that when using this method you should not exceed 28% meaning only 28% of your income should be used paying off your home loan.”

    2. Back end ratio. “The back end ratio method will consider all debts when determining how much money you will have free to pay off the loan. When using the backend method, most people will agree that you will only want about 36% of your income going on debts and expenses,” the article says.

    3. Debts and credit limits

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

    Part of this debt calculation also includes the credit limits which are present on any credit cards or line of credit loans you may hold. This credit limit will be used to determine the debt amount based on the amount of money you have access to, rather than the actual amount the loan or card currently has owing on it.  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 – even if the actual amount you owe on that card is only $5,000.

    So seek to reduce the credit limits on any cards or loans prior to applying for a mortgage.

    4. Stable employment.

    Generally lenders are requiring 6-12 months with the same employer. So think twice about changing jobs if you also want to buy a home in the future, even if the wages are significantly better in the new position.

    5. Credit checks.

    When you put in your application for a home loan, the lender will perform a routine credit file check on you to make sure there are no adverse listings present. An adverse listing can be a default, clear out, Judgment, Writ or bankruptcy which is placed on a person’s credit record by a creditor.

    The most common type of adverse listing is a default, which can be placed on a person’s credit file if they fail to make repayments on any form of credit past 60 days. This includes telecommunications and utilities bills.

    Defaults need not be for big amounts – late payments on bills for as little as $100 can be listed on people’s credit files. Defaults and Judgments remain there for 5 years, with clear outs, Writs and bankruptcies remaining for 7 years.

    Any adverse listing, even an unpaid phone bill will have a huge impact on a person’s home loan approval. Most of the major lenders will refuse to lend to someone who has an adverse listing. In fact, that person 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 record – that enquiry is recorded against your credit file. Currently there is no way of seeing on someone’s credit report if the loan was approved or not, only that the application was made.

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

    If you decide to shop around for the best deal, beware of excess credit enquiries. You could find too many enquiries can mean you blow your chances of approval – even if you would have been approved for every deal. So while it is great to talk a variety of brokers or lenders prior to making an application, you must stress to them that they are only gathering information and are not wishing to make an application until you have decided on a lender.

    7. Obtain a credit report

    If you intend to purchase a home within the year you should request a copy of your credit file. This report is free for the credit file holder every 12 months – and tells you what the lender will see about you when you apply for credit.

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

    There is the potential for creditors to make mistakes when adding credit listings to credit files. So regardless of how diligent you think you may have been with your repayments, it is important to get hold of a copy prior to applying for a loan.

    Adverse listings can sometimes occur due to identity theft; some people are caught in issues over separation from their spouse; some have been disputing the bill which went to default stage and many people are just victims of the fallout from inadequate billing procedures – wrong names, wrong addresses errors with creditor computer systems, and sometimes human error.
    Many times people are unaware they have adverse listings on their file until they apply for a home loan. Unfortunately at that time it can be stressful, and they can lose the home, or be forced to choose a different loan with a higher interest rate.

    8. Dispute any inconsistencies on your credit file.

    If you find inconsistencies on your credit file, or a credit listing which is wrong, unfair or you believe it simply should not be there, current legislation allows for you to have those inconsistencies rectified.

    If you have settled the account, it can be updated to ‘paid’ status, but this may not be enough to ensure finance approval.

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

    Most people have neither the time nor skills to get up to date with the full barrage of credit reporting law if they want to fight a credit listing which has been placed on their credit file.  They are also unwilling or unable to attempt to negotiate with creditors on their own behalf.

    Often a credit repairer is the best person to give you the best chance of having inconsistencies completely removed from your credit file, because similarly to trying to fight your own case in Court, if you don’t get it right, often you don’t get another chance to clear your name, and can be stuck with the bad credit for the term of the listing (5 to 7 years depending on what it is).

    A clear credit record can allow you the option to choose the best loan to suit you, with the best interest rate so it is vital it reads as best as possible to allow as many options as possible – and ultimately save you money.

    For more information on credit repair, contact our Credit Repair Advisors on 1300 667 218 or visit our main site www.mycra.com.au.

    N.B. This post is intended as information only, and should not replace seeking professional financial advice for your situation.

    Image: digitalart/ www.FreeDigitalPhotos.net

  • What Does Your Credit File Say About You?

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    Our credit file is like a mirror on our finances. How healthy are you looking? Here’s a back to basics look at the ins and outs of taking on credit in Australia, and why it’s important to look your best when applying for credit by having a clean credit history.

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

    When you apply for credit, the lender will, after assessing your savings history, your income and your debts – order a credit check on you. This involves contacting one or more of Australia’s credit reporting agencies, to order a credit report from your credit file.

    What the lender sees on your credit file can reflect your assets, your good history, but it can also reveal your financial shortcomings. It can be a reflection of your inability to stick with something, your disregard for repayments, or the financial potholes that are sometimes impossible to climb out of. Let’s look at what a lender might see about you on your credit file, and how you can make sure it looks squeaky clean.

    Your Credit File

    Is a collation of your credit history. As soon as you become credit active, you have a file opened in your name. This file is then attached to you as long as you apply, use and unfortunately abuse credit – it will follow you everywhere in Australia.

    If you have applied to borrow money, or have established an account for services you are considered credit active.

    Every creditor inputs information about you to one or more of the credit reporting agencies in Australasia. Australia’s CRA’S include: Equifax (Formerly Veda Advantage), Dun & Bradstreet, Experian & Tasmanian Collection Services (TASCOL) if in Tasmania.

    What a credit file contains

    – Your credit file includes identity information – such as your full name, date of birth, gender, driver’s licence details, addresses and employer information.

    It also includes other information about your credit and repayment of credit history:

    -Any current active credit and details of current credit providers, for instance mortgages, personal loans and credit cards.
    – Any overdue credit accounts – these may be reported as either a ‘payment default’ or a ‘clearout’.

    How long will I have bad credit?

    Credit Reporting Body Equifax reports these time periods for holding information on your credit file:

    How long is the information held on my credit file?
    • Credit applications and enquiries and overdue accounts are held on your file for five years
    • Overdue accounts listed as a payment default are held for five years
    • Overdue accounts listed as a Clearout are held for seven years
    • Bankruptcy Act Information is held on your file for seven years (prior to January 1998, Bankruptcy Act Information was held for five years)
    • Court Judgments are held for five years
    • Writs & Summons are held for four years
    • Identity information, which includes name, date of birth, sex, drivers license, address history, and linked names (if any) are held for the life of the credit file. This information is used to distinguish the credit file from others held in the database
    • Purge dates are calculated on the date the information was added to the file, and are based on the time limits provided in the Privacy Act 1988
    • Files are scanned each month and out of date information is automatically purged to ensure the files are accurate.

    NB: Even when an overdue account or clearout has been brought up to date or paid in full, it will not be removed from your file.

    All payment default listings remain on file for five years from the date of listing. All clearout listings remain on file for seven years. The fact that an account has become overdue, and then been paid becomes part of your credit history.

    Your credit report

    As the credit file holder, you are legally able to obtain a copy of your credit report for free from all of the credit reporting agencies in Australia every 12 months – and a written copy of your credit file will be provided within 10 days from your written request.

    Every credit active person should obtain a copy of their credit report annually  – regardless of whether or not they think they have a bad credit rating. It is important that when checking your credit file, you obtain reports from all possible credit reporting agencies.

    Definition of a ‘bad’ credit rating

    If you don’t already know you have bad credit, you would be notified at the time of credit application, when the credit provider obtains a copy of your credit file.

    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 even too many credit applications are often considered to be ‘black marks’ on your credit file.

    Impact of a bad credit rating

    If you discover you have a negative listing on your credit file, you will find it very difficult to obtain mainstream credit in the future, generally for the term of the listing (5 -7 years).

    You will likely be refused a home loan with most lenders and possibly be refused credit of many kinds from credit cards to phone plans right through the term of the listing.

    Too many credit enquiries on your credit file may also stop you from getting major credit with most lenders.

    Most times the loan options available to bad credit clients are at significantly higher interest rates in order to cover the risks associated with taking on someone with bad credit.

    Can you change what is said about you on your credit report?

    It depends if the information on your credit report is accurate or not. If your address or other personal details are inaccurate, you may want to contact the credit reporting agencies to have this rectified. But you should also consider why. Do you think it’s possible that there are inconsistencies on your report? If you also have defaults or other credit listings which you feel shouldn’t be there, you should pursue the matter through making a claim with the Creditor to dispute and remove any listings which should not be there.

    Any credit listings which you feel are unfair, incorrect or just shouldn’t be there should be addressed well before you need to apply for credit. The impact of bad credit is pretty severe – and can haunt you for a long time. Spend the time to make sure everything is correct on your credit report.

    You may only get one chance at clearing your credit file – so it’s important to give yourself the best chance of having any inconsistencies removed from your report by using a professional credit repairer.

    Sometimes individuals can attempt to deal with creditors to remove the credit rating default themselves and can do more harm than good by not understanding the legislation.

    Credit repair is a lengthy process, involving the review of all documentation from an individual – 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.

    For advice about whether your adverse listing may be suitable for credit repair, contact a Credit Repair Advisor on 1300 667 218 or visit our website for more information www.mycralawyers.com.au.

    Once your credit file is restored and your bad credit is removed, you will be looking great to the lender, and ultimately feeling great when you have access to the best credit you can, at the best rates.

    Image: Stuart Miles/ www.FreeDigitalPhotos.net

    Image 2: imagerymajestic/ www.FreeDigitalPhotos.net

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  • 5 Loan Solutions For Bad Credit

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    MyCRA Expert Credit Repair Lawyers Can Fix Your Bad Credit So You Can Be Approved!
    MyCRA Expert Credit Repair Lawyers Can Fix Your Bad Credit So You Can Be Approved!

    If you have a default, Clear-Out, Judgment, or Writ noted on your credit file – then you have one of the 4 common types of ‘bad credit’ which show up on Australian credit reports every day. It may be something you have been aware of since your Creditor put it there, or it could be something that slaps you in the face right when you are applying for a loan for a house, car or credit card. But if the question you really want answered is…’How can I get a loan with bad credit?’ we show you 5 ways you might still qualify for a loan while you have a black mark on your credit report.

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

    1. Apply with a lender who does not use credit scoring

    Recently Your Mortgage magazine published the Six ways to get a loan with bad credit, written by Smartline Mortgage Adviser, Kim Wight. Here is her first piece of advice on applying for credit:

    Most lenders use a computer-based system called credit scoring to assess your home loan application, says Ms Wight.

    “This means that the data collected in your application is given a rating or score and if the computer scores you as a bad risk, the application is declined before a real person has a chance to look at the application or hear your story as to why you have had credit problems in the past. In other words, ‘computer says no’,” she explains.

    “By applying with a lender who does not use credit scoring, your application – and the reason for your past credit problems – will be assessed by a real person, who can evaluate your personal situation past and present and use this information to make their decision on your application; it can be a case of, ‘human says yes’.”

    2. Apply with a non-conforming lender

    A non-conforming lender specialises in loan products for higher risk clients. These lenders are an alternative for those people who do not meet the lending criteria of traditional institutions for a variety of reasons, which includes bad credit clients, limited documentation, and low or no deposit clients. With the higher risk also comes a higher interest rate – usually 1% to 3% more than the standard interest rate.

    On the downside, this may add thousands of dollars over the life of the loan. Also non-conforming home loans lenders will require stricter repayment conditions and may penalise late or irregular payments. On the other hand if the payments are consistent and on time for a period of 1 or 2 years some may reward borrowers with interest rate cuts.

    If non-conforming home loans borrowers make regular repayments over 3 years they may be able to refinance their home loan with a standard variable interest rate home loan.

    But this type of loan should really be a last resort for borrowers – and we show you why.

    Norm is looking at a $300,000 loan. The interest rate with the non-conforming lender is 9%. There is a difference of 2% from the standard variable rate of 7% on the loan he was applying for before he found out he had bad credit.

    Norm and his family will pay $15,046.57 more in interest alone with the non-conforming loan just over those first three years prior to refinancing. Use our credit repair savings calculator to find out what it could cost you.

    But how do you apply with a mainstream lender if you have bad credit?

    3. Save more deposit and avoid mortgage insurance

    If you save over 20% deposit, plus your stamp duty and legal costs, you may be exempt from mortgage insurance. The mortgage insurance covers the lender in case you don’t repay the loan. If you can provide the bank with an ample deposit, their approval may be all that is necessary to secure the loan. If your financials stack up, and you have a great deposit, the bank may decide to approve you despite that black mark on your credit file.

    4. Prove to the bank that you can repay the debt

    Your Mortgage also says it is necessary to show a good repayment history if you wish to be considered for a loan while you have bad credit. And this makes sense. If you can’t demonstrate you have moved past those previous problems, by paying your accounts on time – the bank will probably wish to decline your application – whether that be with a mainstream lender or an alternative lender.

    “If you have had problems in the past, you need to show that you are now back on track by ensuring all current financial commitments are being paid on time,” Wight says.

    “This includes not only your loans and credit cards but your rent and utilities as well. Evidence of regular savings will also strengthen your application.”

    The other very essential thing to remember is that honesty is always the best policy when applying for credit. The worst thing you can do when you attempt to look into a loan with bad credit is pretend you don’t have it and hope that mainstream lenders don’t notice. Ah…they will – and this indiscretion will severely hurt your chances of obtaining credit.

    5. Determine whether the bad credit should really be on your credit file

    Sometimes bad credit history is legitimate. It is put there because we haven’t paid our bills on time, and the creditor, having done all the right things, has been left with no choice but to note it on our credit file.

    But in other cases our credit listing shouldn’t be there – because it was issued to our credit file unlawfully. Here are a few quick examples of how bad credit history may be unlawful:

    The listing is unfair (you don’t deserve to have the default in the first place); the creditor has defaulted the wrong credit file (eg system mistake or identity theft); the creditor has not given correct notification prior to the default – just to name a few.

    In these cases and many more, it is in your best interests to check whether you might be able to have the bad credit listing removed from your credit file, so that you can apply with a mainstream lender. If in doubt – get it checked out.

    You should repair your bad credit through a professional for a number of reasons…

    1. Most creditors will tell you they can’t remove the listing.

    2. You need to provide legislative evidence in order to prove the listing was placed unlawfully.

    3. Negotiating with creditors in the wrong way could lead to a fight on your hands and/or documents and client notes ‘disappearing’.

    The best way to see if you may be suitable for credit repair is by contacting a specialist credit repair company or a lawyer.

    You can contact a MyCRA Expert Credit Repair Lawyers Credit Repair Advisor on 1300 667 218 or visit our main site for more information www.mycralawyers.com.au.

    Image: Stuart Miles/ www.FreeDigitalPhotos.net

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  • Dating scam victims most likely to be vulnerable to identity theft

    The Australian Institute of Criminology (AIC) Consumer Fraud Taskforce has published results of an online consumer fraud survey conducted in 2010 and 2011. There have been some interesting revelations, particularly the likelihood that dating scam victims can suffer both financial loss and disclosure of their personal details (the building blocks of identity theft). We look at this survey in detail, and what the results could mean for the health of your credit rating.

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

    The AIC’s Online Consumer Fraud Survey was published last week.

    This report presents the results of the 2010 and 2011 surveys, which each ran for three months commencing from 1 January and encompassed National Fraud Prevention week that coincides with global awareness-raising activities. The theme of the 2010 campaign was Online Offensive—Fighting Fraud Online, which focused on the increased prevalence of online fraud. In 2011, the campaign Scams—It’s Personal aimed to increase awareness about personalised and targeted frauds and scams.

    Both surveys explored scams where respondents had been contacted by phone, SMS, email, letter, via the internet and/or in person by someone that they did not know in relation to:

    • having won a lottery or some other prize (lottery scams);
    • a request for assistance to transfer money out of another country (such as Nigeria; advance fee frauds);
    • a notification of an inheritance (inheritance scams);
    • a request from a business to confirm personal details or passwords (phishing scams);
    • a request to supply financial advice (financial advice scams);
    • an opportunity to work from home (a front for money laundering; work from home scams);
    • pursuing a personal relationship that turned out to be false (dating scams); and
    • other fraud types.

    It was found about 1145 people who responded to the survey lost almost $7 million in 2011 to scams.

    Dating scams were the most likely to result in financial loss or the disclosure of personal details, with almost half of victims reporting they had lost money. Dating scams are more complex and can use identity fraud, along with information gathered from social networking sites, to target and groom particular individuals.

    In 2010, people aged 45 to 54 reported the highest percentage of victimisation. In 2011 the age group with the highest victimisation rate shifted to those aged 65 years and over.

    Assistant Treasurer David Bradbury says it is important that anyone targeted by a criminal scammer report it to the Australian Competition and Consumer Commission on 1300 795 995.

    “Even if the amount of money or information involved seems small, the same scammer could be targeting other people and that information can help prevent more fraud,” Mr Bradbury said in a statement to the media last week.

    Here is an excerpt from the AIC’s report, on the findings of that survey:

    Scams were received by a large proportion of the survey respondents—89 percent in 2010 and 94 percent in 2011. While lottery scams, advance fee frauds, phishing and work from home scams were the most common types of scams received, they were not necessarily the ones that resulted in the highest levels of victimisation. Dating scams, although less prevalent, were the most likely to result in the disclosure of personal details or a financial loss when a respondent was exposed to them. This finding is consistent with scam complaints made to the ACCC (2012a) and indicates that it is not sufficient to just raise awareness about the most commonly received scam invitations, but there must also be a focus on the more obscure scams.

    The results of the number of people falling victims to scams, and the types of scams people have fallen for year to year have changed. This sends some messages about scams:

    1. Education is working. Once consumers are made aware of a scam in the community – it might be likely that victim numbers fall for that particular scam.

    2. Fraudsters are concocting new scams all the time. Because consumers are getting educated – fraudsters are changing scams all the time. Consumers need to be on their guard for new scams.

    3. Just because people have not identified a monetary loss, does not mean the personal details that fraudsters have been able to obtain will not be used at some future time for purposes of identity theft.

    4. The number of people reporting scams is still fairly low – are we all getting too blasé about scams – and at what cost?

    Here is another excerpt from the AIC’s report:

    One of the salient findings from the surveys was the low reporting rate to law enforcement and regulatory agencies. The main reasons provided for not reporting were not thinking anything would be done, being unsure of which agency to contact and perceiving that reporting was not worth the effort. A failure to report scams is problematic, in part because it reduces knowledge and understanding of the nature and extent of scams, not only for creating awareness about current threats, but also in coordinating law enforcement investigations and collecting evidence about small-value, high-volume frauds that may affect a large number of victims. A focus on the reasons why scams were reported, namely preventing others from being scammed, knowing it was the right thing to do and to assist in investigating and apprehending offenders, may be useful in the development of future education campaigns that encourage others to report scams.

    How scams can affect the victim’s credit rating

    For people who have fallen for this type of scam, generally they are robbed of money. But in some cases, the fraudsters can have enough personal information about their victims to be able to get credit cards or loans or even mortgage properties in their name.

    The costs can be significant long term for the victim and are magnified by the fact that fraud is not often detected until the victim attempts to take out credit in their own name and is refused due to credit rating defaults they didn’t initiate.

    It can be quite a shock for someone to realise their entire financial freedom has been taken away, along with any monies that have been stolen from them. Basically someone with credit file defaults finds it extremely difficult to obtain credit for 5 years while the listing is part of their credit record.

    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. Credit rating defaults remain on credit files in Australia for 5 years. The consequence of people having a black mark on their credit rating is generally an inability to obtain credit.

    By law in Australia, if a credit listing contains inconsistencies or is incorrect, the credit file holder has the right to negotiate their amendment or removal, but the difficulty is, to clear their good name, 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 – another reason for vigilant reporting of scams when we come across them.

    For those respondents of the AIC’s survey that revealed disclosure of personal details, I sincerely hope they were advised to keep an eye on their credit report as well as their bank accounts.

    Often going unchecked until the time of credit application, an identity theft victim’s credit report can often be the first sign they have been duped – and by then they can have debts owing and defaults or other listings ruining their financial futures and ability to obtain credit in the future and any signs of the perpetrator of this event can be long gone.

    For advice on how to keep an eye on your credit report if you feel you may be vulnerable to identity theft or if you wish to try to recover your credit file following fraud – contact MyCRA Credit Rating Repairs on 1300 667 218 or visit our main website www.mycra.com.au.

  • Bad Credit Loans In Australia – Are They Right For You?

    After seeing a broker or bank – you find out you’ve got bad credit! After picking yourself up off the floor – you decide to proceed with that home or business loan anyway. But is your only option to seek out one of the many “bad credit” loans in Australia at a much higher interest rate? There could be an alternative for you…determining whether you have grounds to remove the bad credit tarnishing your credit file with the help of a professional credit repair firm. We have provided a basic credit repair suitability test in this post which you can use to find out whether it could be a better option for you than a bad credit loan.

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

    A bad credit report is a big deal. For between 5 and 7 years, you are generally refused mainstream credit with most lenders – especially in the current economic climate. Often people can’t even get a mobile phone plan.

    Despite this, many bad credit loans are available out there for people who are on the outer due to bad credit defaults and other credit listings. But do bear in mind, bad credit (non-conforming) loans generally come at a much higher interest rate, which could cost you tens of thousands more in interest just over the first three years of the loan. For example, on a standard $300,000 loan the difference in 2% from the standard variable rate of say 7% to a bad credit loan rate of say 9% could mean your family is paying as much as $15,046.57 more over those first three years just in interest. Use our credit repair savings calculator to find out what it could cost you.

    Recently savingsguide.com.au published a great article titled A Guide To Loans For People With Bad Credit. It features some pertinent advice about choosing a loan after being refused credit with a mainstream lender. It goes through the steps you may need to take to secure finance in Australia, and includes some final tips for securing a loan. The central tip is, prior to committing to a loan attempt to fix your bad credit issues first.

    “Loans for people with bad credit should really be a last resort, as opposed to the only option. See what you can do to repair your credit rating beforehand and hopefully begin looking for loans just as anyone else would,” savingsguide.com.au’s Alex Wilson says.

    Australians should not put up with bad credit if it shouldn’t be there…contrary to what a Creditor may tell you, bad credit in Australia can be removed from your credit file if it was listed unlawfully.

    If you’re not sure whether you would qualify for credit repair, take a glance at this suitability test. If even one of these 6 questions seems to fit your circumstances, you would be a good candidate for assessment for credit repair by a professional.

     

    Credit Repair Suitability Test

    1. Is the credit listing on your credit file unfair?

    If you believe the Default, Clear-out, Writ or Judgment on your credit file has been unfairly placed then you may have grounds to dispute the credit listing with your Creditor. A professional credit repair firm will build a case for its removal based on credit reporting legislation and also legislation pertaining directly to the Creditor’s industry and your specific circumstances.

    2. Is the credit listing on your credit file a result of identity theft?

    If you have been a victim of identity theft, the onus will still be on you to prove you didn’t initiate the credit. A professional credit repair firm can talk you through the steps to take once you have contacted Police which will help you to recover your good credit rating once again. The process will involve proving to Creditors that you didn’t initiate the credit in your name. It’s not always easy, but it’s a point worth fighting for.

    3. Have you been given the required notification of the credit listing prior to it being placed on your credit file?

    Creditors are bound by strict legislation when it comes to listing defaults, writs and Judgments on credit files. If you suspect you may not have been given the right notice by your Creditor, you may have grounds to dispute the listing and request its removal. It is essential that listings are placed accurately on Australian credit files, and we believe Creditors should adhere to Australian law at all times when placing listings on credit files. If you’re not sure it would be well worth calling a professional credit repair firm to assess your credit file for you.

    4. Does your credit report reflect that the Creditor has the wrong contact information for you despite you notifying them otherwise?

    If you have moved, sometimes bills get sent to your old address. Wrong addresses and phone numbers listed on your credit file can often mean the Creditor has not given you the appropriate notice or warning letters prior to the credit listing. If you think this has happened to you, then this mistake could mean the listing has been placed unlawfully on your credit file.

    5.  Is there an out and out mistake on your credit file?

    Creditors undergo system errors and issues all the time which can sometimes lead to credit listing mistakes. Human error is also a common reason for mistakes on credit files. Sometimes the wrong account can be attributed to you because of a similar name or mistakes with billing amounts or billing addresses can lead to debts you shouldn’t have. If you suspect a creditor may have made a mistake on your credit file, or you’re just not sure, contact a professional credit repair firm who can verify that for you and build a case for the credit listing’s removal from your credit file. It doesn’t have to be a big mistake to constitute an unlawful listing.

    6. Were you undergoing some kind of unusual hardship circumstances which you believe the Creditor has ignored prior to placing the default, writ or Judgment on your credit file?

    If you have told your Creditor you were undergoing financial hardship, then they are generally bound to help you make better payment arrangements as a solution to this hardship rather than immediately placing a credit listing on your credit file. If your credit report reflects this issue, a professional credit repair firm might be able to help you have this unfair listing removed.

     

    There are many more reasons why you might be suitable for credit repair based on your individual circumstances. If you would like an assessment for your suitability for credit repair, talk to a consultant at MyCRA Credit Rating Repairs who can assess how you might fare in removing bad credit before you commit to any bad credit loan in Australia.

    Image 1: Stuart Miles/ www.FreeDigitalPhotos.net

    Image 2: Master isolated images/ www.FreeDigitalPhotos.net

  • Bad credit affects refinancing market too

    Refinancing numbers are at a record high. But any home owner looking to refinance needs to consider they could have surprise bad credit history. Before you apply for a new loan, it is important to check your credit history prior to making any finance application, even if you think your repayment history is impeccable.

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

    Australian Broker reported Tuesday on figures coming through from AFG showing figures for refinancing have gone through the roof in the past 12 months, with two in five loans now refinancing:

    Refinancing outweighed all other loans on AFG’s Mortgage Index at 39.1 per cent for June.

    Mark Hewitt, general manager of sales and operations at AFG attributed the growth to a more competitive market.

    “Refinancing is very strong as borrowers take advantage of a more competitive market to secure a better deal,” he said.
    AFG also said fixed rate loans fell to 16.5 per cent – a significant decrease from March’s peak of 25.4 per cent.

    “It’s significant that, as we begin a new financial year, the vast majority of borrowers are opting not to lock in an interest rate. Most see a period of stable or even softer rates for the foreseeable future.”

    Before refinancing

    Prior to making a re-financing application, you should order of free copy of your credit report – in case your credit history contains inconsistencies you aren’t aware of. For some home owners, it can be years since you applied for major credit, who knows what information is present on your credit file?

    Under current credit reporting legislation, you are entitled to obtain a free copy of your credit report from the credit reporting agencies once a year. A person requesting their own credit report does not generate a ‘credit enquiry’ on their credit file so it is important to do this prior to putting in the application. If a credit enquiry from a lender finds a default against your name, warranted or not, you will be refused finance. That lender’s ‘enquiry’ now shows up on the credit file for 5 years along with the default, creating two negative entries instead of one.

    You need to contact all the credit reporting agencies to request your credit report – as creditors have access to 2 main agencies within mainland Australia and 3 if in Tasmania. The report will be sent to you within 10 days of the request.

    Regardless of whether you have been diligent with paying bills, creditors can and do sometimes make mistakes with credit files, which can leave you with black marks against your name that just shouldn’t be there.

    Sometimes you may not know your good name is compromised until you apply for finance or in this case re-finance and are refused.

    What is bad credit?

    A bad credit rating can result often due to unpaid accounts. When a bill or repayment goes unpaid past 60 days, it is listed as a default or a ‘clear-out’ on your credit file. In the current finance market, any black mark generally results in an automatic decline with the major lenders, as does too many credit enquiries.

    So how many credit files contain errors? The volume of credit file errors on Australian credit files is uncertain.

    A spokesperson from credit reporting agency, Veda Advantage estimated 1% of the 250,000 credit reports they give out as a credit reporting agency to Australians every year contain a material error on the credit file.

    But the Australian Consumer Association (now Choice) survey from 2004 revealed that 34% of the credit files surveyed in their small scale study contained errors or inconsistencies.

    And the real numbers? They may be somewhere in between.

    Approximately 63% of the clients who request credit repair have defaults, writs or Judgments which are listed in error on their credit file.

    We have clients who are facing identity theft; some are caught in issues over separation from their spouse; some have been disputing the bill which went to default stage and many people are just victims of the fallout from inadequate billing procedures – wrong names, wrong addresses, human and computer errors.

    Listings are not removed by creditors unless you can provide adequate reason and lots of evidence as to why the listing should not be there.

    Credit repair requires knowledge of the legislation, lots of evidence and perseverance. But if your financial freedom is hindered because your credit file contains errors, it is a point worth fighting for.

    Contact MyCRA for help with getting a free copy of your credit file, or for help with credit repair on 1300 667 218 or our main site: www.mycra.com.au.

    Image: Michal Marcol/ www.FreeDigitalPhotos.net

    Image: Stuart Miles/ www.FreeDigitalPhotos.net

  • Help I have applied for my first home, but I have been declined! How do I fix bad credit?

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    Bad credit is common,  affecting millions of Australians and sometimes it goes undetected until your loan is DECLINED.

    This ‘surprise bad credit’ can see you declined on a home loan application. We show how it may have happened, and give you 7 steps to fix a bad credit report.

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

    Applying for finance for a home can be nerve-wracking. There’s the deposit – have I saved enough? There’s your income – do I earn enough? There’s the home – have I paid the right price?

    When all of these factors combine to give you, on the face of it, a good chance of approval for finance then there’s the issue of choosing the right home loan, at the right rate, with the right factors for your future. So you go through all of these sometimes stressful aspects of property buying, and you make the official application for finance with your chosen lender. It all looks good…

    Until you are slapped in the face with an APPLICATION DECLINED. You should qualify for a home loan, but you don’t because your credit report shows up with a default.

    You have no idea what the default is for…you always pay your bills on time…but that little default from what looks like a utility company, is messing with your future and caused the decline.

    How can they refuse me a home loan based on this, you ask? They can, and they do. You see, a default is an account in arrears greater than 60 days.

    If you have a default on your credit file, it tells the lender that you don’t pay your bills on time. They have a responsibility to ensure you can manage the debt you will accrue. This is evidence that you can’t manage your debts, you look like a risk to them, so they refuse you the loan, despite all the other factors being in your favour.

    What Do I Do Now?

    Now you know you have bad credit, you have two options. You can wait for 5 years. A default remains on your credit file for 5 years from the time it was listed, and after this time it ‘drops off’ your credit report. It will impact your ability to obtain credit generally for the entire time it is listed on your credit file. So – for 5 years you will have a hard time getting anything other than a credit decline anywhere, from mortgages to car loans to credit cards and even mobile phone plans.

    If you don’t want to wait, you can investigate whether it should be there at all.

    Mistakes can and do happen. Mistakes in credit reporting are most times only picked up by the credit file holder, so if you think there is something amiss with your credit file it is up to you to put it right.

    Here are the steps you need to take to correct errors on your credit file:

    7 Steps to Fixing Credit Reports

    1. Determine what account the default is for.

    If you don’t have a copy of your credit report, you will need to order one. If you haven’t ordered a copy of your credit file in the last 12 months, it will be free from the credit reporting agencies in Australia. They are Equifax (Formerly Veda Advantage), Dun & Bradstreet, and Tasmanian Collection Service (if in Tasmania). You may have listings with one or all of these credit reporting agencies. They will take 10 working days to send you a copy of your report. For a small fee, you can have one sent to you urgently.

    On your credit file, will be the company the default is with, and an account number. This should correspond with an account you have with them. If it doesn’t, or if you don’t have any accounts with the company in question, there is a good chance there may be a mistake on your credit file.

    2. Gather all your information first, and try and determine how the default got on your credit file.

    Before you call the company in question, sort out what you know about the situation. Have they made a mistake? How have they made it?

    4. Write to the Creditor to ask for information on the account.

    You may need to find out more about how the default got there. Every company keeps a record of its customers and you can write to them and request your account records to date.

    5. Decide on how you’re going to tackle them.

    Now you want to try and negotiate for the Creditor to remove your default. Don’t go in guns blazing – bear in mind, there is nothing to say they have to remove the default. Want you want to do is encourage them to do the right thing by you.

    6. It is going to be hard going.

    Most people find it really hard to correct their credit listing themselves –especially if it’s complicated. For one, the Creditor has to comply with a whole heap of legislation that crosses different codes, and if you don’t know legally where they may have made errors – it’s pretty hard to persuade them they have done the wrong thing. And who’s got time to learn all of that?

    Secondly, negotiating anything on your own behalf can be tricky – the old foot in the mouth routine can get you into trouble and see you stuck with the listing for the whole term. In reality, many people trying to fix their own credit rating get told they can have the listing marked as paid, but it is never removed. This is not enough to guarantee you the home loan. If you were able to show cause as to why the listing was put on your credit file unlawfully, there is a chance it will actually be removed.

    7. Consider getting a professional on board.

    For a pain-free approach – at any time, you can hire the services of a credit repair professional law firm. Most of them will look after getting a free copy of your credit file for you, order your documents from the Creditor as well as directly negotiate with them to remove your bad credit, based on the relevant legislation applicable to your case.  And most importantly, they will probably think of things you had never thought of to strengthen your case for the default removal. This is your best chance at getting the listing removed completely from your credit file, which will allow you to apply for finance with a mainstream lender again… Without the DECLINE!

    If you’ve done the crime, you may need to do the time

    If you’re a serial offender for late payments, if you are currently struggling to keep your head above water, then new credit- especially major credit such as a mortgage- is NOT going to make it all better. We don’t advocate wiping the slate clean because of a technicality, and contributing to your fall from grace once again when you default on your home loan. The credit reporting system was designed for you, to stop you from getting in way over your head and maybe 5 years without credit is a good time to learn some financial strategies for the future. This is where a decline can actually be helpful.

    But, if you firmly believe you are capable of making repayments on this home, if you know that the listing was put there unfairly, or perhaps even if the listing was accrued because you had a period of financial stress you have now recovered from and you weren’t helped in the appropriate ways at the time, then you may have a case for removing the default. If you are unsure, you can always talk to MyCRA Lawyers on 1300 667 218, who can make an assessment for you on your suitability for credit repair.

    Image: stockimages/ www.FreeDigitalPhotos.net

    Image: David Castillo/ www.FreeDigitalPhotos.net

     

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

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

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

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

    What is a credit report?

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

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

    What is defined as a ‘bad’ credit rating?

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

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

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

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

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

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

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

    Will I always know I have bad credit?

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

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

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

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

    What can I do to fix my bad credit rating?

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

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

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

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

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

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

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

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

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

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

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

    What can I do to maintain a good credit rating?

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

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

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

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

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

     

    Image: annakml/ www.FreeDigitalPhotos.net

  • Financial worries could loom over economy: Consumer Advocate for credit reporting accuracy

    On the whole it seems Australians are feeling insecure about their finances. Is this the catalyst for or as a result of the slow housing and finance market? Is the doom and gloom all in our minds or are Australians in real trouble which could lead to a debt crisis and the accumulation of bad credit history by some sectors of the population?

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

    Yesterday Business Day reported on a worldwide survey showing Australian consumer confidence was significantly reduced despite the strength in the Australian economy in comparison to other countries.

    The article, titled We’re Saving For a Gloomy Day addresses Australia’s growing pessimism as featured in a survey brought out by Boston Consulting Group. The survey suggests the savings habits of Australians born in the midst of the global financial crisis are here to stay.

    “In its 11th annual consumer sentiment survey conducted last month with 15,000 consumers in 16 countries, BCG asked respondents a series of questions around financial and job security, spending plans and savings habits. The results showed Australian shoppers were among the most worried and financially insecure in the developed world, and planned further cuts in discretionary spending,” the article says.

    This sentiment is not surprising, considering the key finding from the survey shows that not only are Australians cautions, but that the rates of consumers who feel they are in financial trouble has soared:

    “47 per cent of Australian consumers felt they were in financial trouble or not financially secure, up from 36 per cent in 2011. This heightened sense of panic compares with 48 per cent in the US (where the unemployment rate is double Australia’s), 43 per cent across the European Union, 41 per cent in Spain (unemployment close to 25 per cent) and 45 per cent in recessionary UK,” the article says.

    Here are the results from the survey country by country courtesy of Business Day:

    So what is causing this fear? Perhaps the drop in house prices (on average 4.5% over the past 12 months according to the Australian Bureau of Statistics) could be having a significant impact. Perhaps a reduction in the level of household equity has meant many are reluctant to increase spending as there is no longer a buffer in their biggest asset – the family home.

    This was the viewpoint of the leader of BCG’s consumer practice in Australian and New Zealand, James Goth.

    Mr Goth said a downturn in the housing market was affecting spending plans in Australia and feeding the pessimistic outlook.

    ”Another reason why I think we are so bearish in our discretionary spending outlook, regardless of how well the economy is doing and how good unemployment rates are, is the breaking of the house-price cycle – people can no longer fund these very high expenditure rates based on ever-increasing house prices, he told Business Day.”

    So what could be the long term prospects for the housing market and lending finance numbers?

    This week’s March housing finance statistics reported by the Australian Bureau of Statistics show a 0.3% rise in home loans to owner occupiers, but the proportion of first home buyers fell to 16.4 per cent. In all, the total value of dwelling finance commitments fell 0.5 per cent in March compared with February in seasonally adjusted terms.

    ABS HOUSING FINANCE March Key Points:
    VALUE OF DWELLING COMMITMENTS

    March 2012 compared with February 2012:

     The trend estimate for the total value of dwelling finance commitments excluding alterations and additions fell 0.2%. Owner occupied housing commitments fell 0.5%, while investment housing commitments rose 0.4%.
     In seasonally adjusted terms, the total value of dwelling finance commitments excluding alterations and additions fell 0.5%.
    NUMBER OF DWELLING COMMITMENTS

    March 2012 compared with February 2012:

     In trend terms, the number of commitments for owner occupied housing finance fell 0.4%.
     In trend terms, the number of commitments for the purchase of new dwellings fell 1.3% and the number of commitments for the purchase of established dwellings fell 0.6%, while the number of commitments for the construction of dwellings rose 1.1%.
     In seasonally adjusted terms, the number of commitments for owner occupied housing finance rose 0.3%.
     In original terms, the number of first home buyer commitments as a percentage of total owner occupied housing finance commitments fell to 16.4% in March 2012 from 17.2% in February 2012.

    The minutes of the Reserve Bank of Australia May board meeting were released on Tuesday and noted that weakness in non-mining sectors was persistent and was predicted to continue.

    The Sydney Morning Herald reported in its article Slowing Growth, rate rises tipped RBA’s hand that among other economic factors, slowing credit growth and demand for housing finance were involved in its decision to cut interest rates this month.

    “Demand for housing finance had eased in the past few months and recent data suggested that dwelling prices had continued to decline, although there were tentative signs that the pace of decline had been more gradual in recent months,” the RBA minutes said as reported in SMH.

    “Credit growth for households had been marginally lower over the past year than over the previous year, and business credit was rising only at a very modest rate,” the minutes said.

    Do the facts show Australians are really experiencing financial difficulty?

    The sentiment was echoed by Dun and Bradstreet’s Credit Expectations Survey released on April 30, 2012. It pinpointed in its survey of June quarter savings, credit usage, spending and debt performance expectations that many who can meet credit commitments are choosing not to, but that there is a significant portion of people struggling with their current debt levels.

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

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

    “Unfortunately, we are seeing the least-solvent consumers accumulating unmanageable levels of debt, while those best able to meet credit commitments are avoiding spending altogether,” Mr Jones said.

    “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.

    Should this cycle continue, and a portion of people continue to accumulate unmanageable debt levels, the result will be a possible increase in the number of credit file defaults – with the only saving being – well – savings.

    The level of savings reported in the country is heartening – we have learnt from other countries post GFC, and the smart savings of many, whilst it may hurt the retail sector – would buffer many families from a credit debt crisis like we have seen in countries like the United States. But as often happens, for those with a high proportion of debt who don’t have the luxury of saving – they may be thrown into the debt cycle– robbing Peter to pay Paul just to stay afloat.

    For those who accumulate a bad credit history, the prospect of recovery would be slow. For between 5 and 7 years they will be refused mainstream credit and be on the outer – any credit they are approved for would generally be at a higher interest rate, meaning they are going to struggle even further to pay back their debts. The consequence of possible defaults on new loans could mean they are trapped in this cycle for a very long time.

    In this sense, for those who are living with credit file defaults which they believe shouldn’t be there, it would save them thousands by addressing the problem and having those credit rating errors addressed and potentially removed. As a safeguard for the future should lending criteria tighten even further, any inconsistencies on a person’s credit report should be addressed now – before it is urgent. People can contact a credit rating repairer to help with building a case to have those credit listings placed in error on their credit file removed – as their right and responsibility.

    Image: renjith krishnan/ FreeDigitalPhotos.net

  • How To Save On Your Home Loan and Prevent Mortgage Stress

    A drop in house prices across many parts of the country could see some families owing more than their homes are worth.  Luckily interest rate cuts may offset this change and give people the chance to make some headway on their home loan despite the reduced equity. So what are some real and significant things families can do to actively reduce their home loan and prevent mortgage stress or at worst – bad credit from late payments?

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

    The Australian Bureau of Statistics reported earlier this month that house prices around Australia have fallen by an average of 4.5 per cent over the past 12 months.

    For people who have recently purchased their first home, this could amount to some negative equity – which is quite a frightening prospect for many. For those about to purchase their first home – it could put them off buying all together. But this may not need to be the case. Certainly many buyers in this market should be fairly cautious with where they buy – but it just may be a case of ensuring they look at their purchase as a long term investment – structuring their loan accordingly if possible and allowing for places where they can make extra payments to their loan.

    The Sydney Morning Herald recently ran an article titled Extra payments a winner showing how the recent interest rate cut can actually make a significant difference for home owners if they continue to make mortgage repayments at the previous level.

    “The 50-basis-point cut represents a $96 a month reduction in mortgage payments for home buyers with an average-size loan of $300,000 (assuming the full cut is passed on).

    But for people who can afford to maintain their payments at their current higher level it presents a great opportunity to make inroads into their outstanding principal and build a buffer for tougher times.

    Given the uncertainty in markets, and the economy, it is a good strategy to build greater equity in the home,” the article says.

    They recommend visiting ASIC’s Money Smart website to calculate the potential interest saved on extra payments to their home loan: www.moneysmart.gov.au/tools-and-resources/check-asic-lists .

    The article included this significant advice for borrowers:

    A home borrower’s handbook to keep you out of trouble

    ❏ Know what you can afford. Don’t rely on the lender to tell you what you can borrow. Make your own assessment by writing a household budget with all outgoings and see if there is enough to cover the mortgage repayment. According to Veda Advantage and Fujitsu Consulting mortgage stress reports, the groups that most often get into trouble with repayments are low-income families and young families.

    ❏ Don’t just look at the rate. According to QBE LMI’s 2012 Australian mortgage market study, when people are looking for a loan they place most emphasis on the interest rate and the fees. Options such as redraw, offset and the ability to split the loan between fixed and variable rates are given a low priority.

    ❏ Stress-test your loan. Lenders will check to see if you can continue to make payments if rates go up 2 percentage points. What if rates go up 3 percentage points or more?

    ❏ Watch your credit-card spending. Surveys of people experiencing hardship with home-loan repayments show that large credit-card debts can be the trigger for arrears or defaults.

    ❏ Make extra repayments. According to ING Direct’s Financial Wellbeing Index, 40 per cent of mortgage holders are making extra repayments on their home loans. These payments serve two purposes: they create a buffer that can be called upon if circumstances require; and they speed up the repayment of the loan.

    ❏ Invest in your mortgage. A lump-sum payment that reduces the loan principal is, in effect, an investment with a return equivalent to the mortgage interest rate, free of tax.

    ❏ Deal with problems early. The Legal Aid Mortgage Stress Handbook recommends that borrowers seek advice early from their financial institution or a financial counsellor. Many people leave it too late.

    Unfortunately, for those home owners who have entered into a higher interest rate with a non-conforming loan, the interest rate cuts will be negligible for them. They can be up for tens of thousands of dollars more during the first three years of the loan. Our calculations show on a home loan of $400,000 they could be charged an extra $22,867.15 more in home loan repayments over the first three years of the loan. This is based on average loan of $400,000 over 30 years on non-conforming loan interest rate of 9.5% versus the standard variable rate of 7%.

    To calculate potential savings people can visit the MyCRA Calculator.

    For people considering a non-conforming loan due to bad credit that should not be there, it would be extremely beneficial for them to instead look at disputing the credit listing and having their credit rating repaired. If they were successful in having listings removed from their credit report which either should not be there or were put there in error, they could restore their good credit rating in this instance and apply for a standard home loan – potentially saving themselves thousands.

    But instead it is often the case that people get a negative credit listing after a dispute with a creditor or worse – surprise bad credit – and are under the impression they have to put up with the hand they are dealt with. Some contact their creditor, and are told that they can have the listing marked as paid if the account was paid, but the listing is never removed from their credit file. The ‘paid’ listing is unfortunately still going to be a detriment to their ability to qualify for a home loan and they are stuck with the tag of ‘bad credit’ for between 5 and 7 years depending on what’s on their credit file.

    However, if the listing was put there unlawfully or unjustly, then the credit file holder does have the right to have those inconsistencies addressed and potentially removed from their credit file. It takes lots of knowledge of the relevant legislation and some good negotiation ability to be able to formulate a successful case to remove a listing. Which is where credit rating repairers come in – to act on the credit file holder’s behalf and enforce that legislation creditors are bound to comply with, helping to demand accuracy in credit reporting and negotiate for the removal of those listings which shouldn’t be there.

    In this market – it can make all the difference for a potential borrower – and be a fight entirely necessary to make to ensure people get the home loan they deserve.

    For help and advice on credit rating repair, contact MyCRA Credit Rating Repairs on 1300 667 218 or visit our main website www.mycra.com.au.

    Image: chainat/FreeDigitalPhotos.net

  • The credit card mistakes that increase your risk of bad credit history

    What are the mistakes you could make with your credit card that potentially increase your risk of bad credit history?  We look at the advice for credit cards that could save your credit rating.

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

    Savings Guide Australia featured a great article on the 7 Classic Credit Card Mistakes. It reports on info from MSN Money on the Seven Deadly Sins of Credit Card Use. They provide some useful information on the right way to think to avoid credit card mistakes that could hinder your credit report.

    Some really important points from this SavingsGuide.com.au article are:

    Don’t max out the credit card…

    “Consistently nudging your limit at the end of the month is a sign you should be reconsidering your usage and budgeting to allow more financial space for saving.”

    Be wary of unnecessarily high credit limits…

    “It doesn’t even matter whether or not your card is maxed out, when applying for a loan, your credit limit becomes important. If it’s high, it can undermine your approval opportunities.”

    Avoid Cash Advances…

    “The price is high; huge interest calculated from the day you borrow, making it very difficult to get on top of your credit card repayments. Avoid at all costs.”

    Here are some more ideas to prevent your credit card use from leading to a bad credit rating from my post on How to avoid bad credit history from credit card debt:

    Create your own credit limit.
    Set yourself a limit based on what you can comfortably afford to repay. It’s important to realise that you will pay at some point for the credit you use. Make sure at worst case scenario you can afford to repay it. You will then have confidence in your spending without the temptation to overspend.

    Don’t exceed the credit limit.
    This will just mean you incur hefty charges.

    Pay off the balance each month.
    Ideally, pay off the entire card balance within the interest free period. If you don’t, you will be charged interest right back to the date you purchased each item. You not only lose the interest-free period on those past purchases, but until you pay off the balance there will be no interest free period on anything you spend in the future.

    Or, choose a low interest card, but still pay more than the minimum repayment amount each month.
    If you have debt which carries over on your card month to month you should look at a card that has a lower interest rate. It may not offer an interest free period, or hefty rewards points, but the lower interest rate should mean the carried over debt is more manageable for you, and will prevent possible bad credit history.

    If you want to see what is said about you on your credit report, you can do this for free every 12 months from Australia’s credit reporting agencies. For help with getting a copy of your yearly free credit report, you can contact MyCRA.

    We may also be able to help repair your bad credit history, or give you more information on your credit rating. Visit our website www.mycra.com.au or call MyCRA Credit Rating Repairs tollfree on 1300 667 218 for more details.

  • Are you at risk of identity theft?

    How much are you putting your life, your personal information and your credit file at risk of fraud? Test your awareness of identity theft, determine what you don’t know and take some steps to protect you and your family. This initiative is part of Privacy Awareness Week 2012, of which MyCRA Credit Rating Repairs is a partner.

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

    Last year, as part of Privacy Awareness Week, the Asia-Pacific Privacy Authorities developed an Id Theft Self-Assessment Test in which you are asked 11 questions on various topics. At the end, you will receive an assessment of how at risk you are of identity theft.

    Here’s some things you may not know about identity crime…

    Identity crime is an area which is ever-growing and ever-changing.

    It is reported that 1 in 6 people in Australia is a victim or knows someone who has been a victim of identity theft or fraud in the past 6 months.

    Victims are not always ‘gullible’ as may be the impression in the wider community. Many experts say it is not a matter of if you experience an identity theft attempt, but when.

    It can originate from someone you know – for example an acquaintance obtains identity documents or credit card details to impersonate you. Or more increasingly it comes from professional fraudsters whose main occupation is to steal personal information and financial details in order to commit fraud.

    Fraudsters are after your personal information. The internet is a big source of personal information and its ever increasing use makes you more vulnerable to identity crime than ever.  This means identity crime can have very long arms – often it originates from overseas crime syndicates. Social networking, online banking, company databases and email scams can all be havens for today’s cyber- criminal.

    You can also fall victim to a number of rampant telephone scams, credit card skimming, or criminals can also take to going through your rubbish bin for anything they may be able to use to steal your identity.

    Identity theft is increasing because the pay-offs are huge for criminals. It is estimated identity crime costs Australians $1 billion a year (OECD Committee on Consumer Policy, Online Identity Theft, February 2009, p. 37).

    In cyber circles alone, world estimated costs for cybercrime are staggering.  Cyber-crime expert Mischa Glenny says that while there are no precise figures out there, the White House suggested in 2009 that cybercime and industrial espionage inflicts damage of around U.S. $1tn per year, which is almost 1.75% of GDP.

    “Traditional bank robbers must be absolutely gobsmacked when they hear sums like this being hoovered up by cyber- criminals week in, week out,” he says.

    How can I be affected?

    We consider if someone is alerted to having money stolen from credit cards early, or perhaps is able to call their bank and stop fraud in its tracks – that they are the lucky ones.

    The unlucky identity theft victim is unaware of the fraud until their identity is misused, and their credit rating with it. When identity theft damages your credit rating – it is because the fraudster has been able to overtake credit accounts, or has gained access to enough personally identifiable information about you to forge new identity documents.

    This gives the fraudster access to credit cards, loans, even mortgages which allows them to extract significant amounts of money without you realising it straight away.

    If credit accounts are not repaid – after 60 days you may be issued with written notification of non-payment and the intention for the creditor to list a default on your credit file. It is at this moment that some people who were previously unaware of any problems find out they have been victims of this more sophisticated type of identity theft.

    But often the credit file holder has also had their contact details changed – and this means it is not until they apply for credit in their own right and are refused that they find out about the identity fraud. This can be a significant time after the initial crime.

    Some signs to watch out for include:

    1. Strange unaccountable withdrawals on credit or personal bank accounts. It may not need to be a big amount to indicate fraud. Many criminals do ‘test’ amounts to begin with before extracting more significant amounts.
    2. Phone calls or emails from what often appear to be legitimate companies, asking for money or personal details. If you have given bank details or personal information in this way either online or on the phone there is a high chance it was a scam. Verify with the company in question.
    3. Can’t log in to social networking or bank accounts.
    4. Credit refusal
    5. Bills or letters of demand sent to you for accounts you don’t know about
    6. Missing mail – particularly credit card statements which could indicate someone has overtaken your accounts. In this case no news is not good news.

    What can I do if I suspect I am a victim of identity theft?

    Notify Police immediately. Many people do nothing due to embarrassment, or because they don’t believe the fraud was significant enough. But is only through this crime getting reported that statistics get collated, and we start to have any chance of catching the criminals.

    Notify creditors. You may need to cancel credit accounts.

    Obtain a credit report. This report is free once per year for every Australian who holds a credit file. It will indicate to you whether any of your contact details have changed, or whether there have been credit enquiries on your account. If you act quickly enough, you may be able to stop your credit rating from being affected by black marks which would come from fraudsters obtaining credit in your name.

    Notify credit reporting agencies of the possible fraud. They will be able to put an alert on your credit file.

    Police may assist you in obtaining a Victims of Commonwealth Identity Crime certificate, if they believe you are eligible. You can apply to a magistrate in your State for this certificate, which may help in recovering your credit rating or credit accounts. Victims need to have had a Commonwealth Indictable Offence committed against them. For more information, visit the Attorney-General’s website www.ag.gov.au.

    What steps can I take to prevent identity theft?

    1.Keep virus software up to date on your computer. Install automatic updates and perform regular virus scans.
    2.Keep your privacy settings secure on all social networking sites.
    3.Keep our passwords and PIN numbers secure. Don’t carry PIN numbers with your credit/debit cards, change passwords regularly and use a variety of passwords for different purposes.
    4.Check all your credit card and bank statements each time they come in.
    5.Cross-shred all personally identifiable information which you no longer need.
    6.Buy a safe for your personal information at home.
    7.Do not give any personal information or credit card details to anyone via phone or email unless you are sure the site is secure, and or you can verify the company details.
    8.Be aware of who gets our personal information and for what purposes. What can these people do with the information they are gathering? For instance, is it really necessary for the site you are registering on to have your date of birth?
    9.Keep up to date with the latest scams by subscribing to the government’s ‘SCAM watch’ website. For a list of ways your computer can put you at risk, visit the governments Stay Smart Online website www.staysmartonline.gov.au.
    10.Check your credit file.

    If you or someone you know needs help to remove bad credit history on their credit rating following identity theft, contact MyCRA Credit Repairs, www.mycra.com.au or call tollfree on 1300 667 218 for confidential advice and help restoring your good name.

    Image above: Chris Sharp/ FreeDigitalPhotos.net

    MyCRA Credit Rating Repairs is proud to be a partner for Privacy Awareness Week 2012.

  • Emergency loans from family and friends are rampant – where’s the backup plan?

    When times get tough, we all hope our friends and family would be there to lend a helping hand. But if we come up against an emergency, especially if we have a small to medium business, we need to be able to first apply a ‘back up plan’, which may involve borrowing money. Ask yourself – is this possible? Or would we have to borrow from family to get us over that hump? A study has found more than 20% of Australians have lost friends over borrowed money. So what’s your contingency plan?

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

    Smart Company published a story today titled ‘SMEs warned on borrowing from family and friends as monthy “friendly” debt pile tops $1.6 billion a month’, reporting on a survey commissioned by the Commonwealth Bank showing the average Australian borrows more than $200 from loved ones every month.

    “This equates to more than $1.6 billion a month, with “unforseen or emergency situations” identified as the most common reason for borrowing (49%)… While the majority of respondents (85%) say they were brought up to repay their debts, 49% have experienced disagreements when it comes to paying loans back,” Smart Company reports.

    The study is based on a survey of 1,193 Australians aged 16 to 39.

    Commonwealth Bank executive general manager of cards, payments and retail strategy, David Lindberg says millions of Australians rely on informal borrowing networks.

    “[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”][But] borrowing money from friends and family can be the cause of disagreements, whether that’s over the amount or best way to pay someone back,” Lindberg said in a statement to Smart Company.

    A back-up plan

    Anyone who owns their own business, their own home or has any sort of significant debt needs to spend some time thinking about what the go-wrongs could be, and set up a plan for what to do. Then they can stop worrying about the go-wrongs and keep going forward with confidence.

    What if we lost our job? What if interest rates went up significantly? What if business went down really fast – such as what happened to many people after the GFC? What if someone did the wrong thing by us? What if we were short one month or two? What if we got sick?

    I have come up against some go-wrongs in my time. In the early 2000’s I owned my own Promotions Business. Like many salespeople, I was good at talking, but not so good at the paperwork. This led me to bring in a mate who was good at paperwork.

    The bloke I brought in was good alright – he was good at stealing over $130,000 of borrowed funds from the business over four months. So repayments were due and I had no money to make them. After receiving some bad advice, I declared bankruptcy.

    Later I learned the bankruptcy was not necessary, there were some things I could have done differently, and I would have been alright.

    Hindsight is wonderful, foresight is golden. In my next business ventures, I instilled a ‘back-up plan’ to cover an emergency.

    Little did I know, in time I would require one.

    After a couple of years building up my mortgage brokerage, at the height of its success, I was dealt a blow that too many have been dealt. I was told I had Cancer. I powered on at work – but I am sure I wasn’t as productive in my own business as I would have been if I had been healthy. What saved me and my business was my back up plan. Never did I let my accounts go unpaid. My credit file remained squeaky clean through it all. Once I recovered, I was able to bounce back financially and get myself to where I am today with MyCRA.

    Here are some things for you to consider about constructing your own back-up plan:

    1. Get good solid financial advice from a recommended and trusted advisor. They may offer ideas you hadn’t considered in the formulation of your back up plan from what sort of ‘buffer’ you would need to be comfortable, to recommendations for relevant products and services.

    2. Consider insurance. Income protection, health insurance, disability insurance among others could all be viable options for you. Refer to the government’s business website for more information on insurance if you run a SME.

    3.  Could you borrow money if necessary? Ensuring all of your accounts are paid on time is the best way to secure the ability to obtain credit in the future. But sometimes mistakes happen with your credit file. Listings can be put there incorrectly, and these could see you blacklisted from credit unnecessarily. Obtain your credit report for free every year from one or more of Australia’s credit reporting agencies. Obtain both your consumer and commercial credit files and make sure they are accurate. If your credit report does contain inconsistencies, get those defaults removed from your credit file if they shouldn’t be there NOW. Don’t wait until something happens – sometimes it can take time to repair the credit file damage.

    When you need emergency money

    1. If you do need to borrow money for an emergency – decide early whether the problem is short or long term. Don’t bury your head in the sand and ‘hope’ that things improve when the problem is really long term. Borrowing from Peter to pay Paul is the quickest way to get you or your business in to long term debt. Remember, overdue accounts of more than 60 days will show on your credit file for between 5 and 7 years – depending on the listing.

    Even if you can get over the hump now – you will not be able to borrow to expand while you have bad credit history. Long term, you are better off addressing problems now – whether that be to sell the house, the business, downsize or re-group. If you are in genuine financial hardship, talk to your bank about Financial Hardship relief on any borrowed funds – this is a legitimate option which your bank is required to provide you with under certain circumstances.  Act now to save your future rather than spoil your credit rating.

    2. If you believe you will have financial problems for some time, consider a Financial Counsellor. Visit the Financial Counselling Australia website for more information.

    3. If you are going to borrow from family and friends set the terms in stone. Consider getting the terms of any loan down in writing and signed by all parties are aware of what the conditions of the loan will be. Then stick to it.

    This post is intended as information only and in no way is intended to replace or constitute professional financial advice. For money help, you can look at the Government’s Money Smart Website, or contact a professional Financial Advisor.

    Image: graur razvan ionut/ FreeDigitalPhotos.net

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  • Graham the ‘Credit Corrector’ placed No.24 in Top 50 – Start-Up Smart Awards 2012

    Entrepreneur Graham Doessel is delighted to announce placement at number 24 in the Australian Start-Up Smart Awards 2012 for his credit rating repair company, MyCRA Credit Rating Repairs.

    Graham was once Australia’s most successful non-conforming broker. Now he’s a full-time ‘credit corrector’ and consumer advocate challenging creditors to improve accuracy in credit reporting – one listing at a time.

    An excerpt from the Start-Up Smart Awards website explains the beginnings of MyCRA Credit Rating Repairs:

    “At the busiest time in his career, Graham Doessel was diagnosed with cancer. Up to his ears in work, he was forced to step back from it all in order to make a full recovery.

    While Doessel was receiving treatment, he witnessed the negative impact of the global financial crisis on credit applicants. In the wake of it all, Doessel decided to do something.

    He developed My CRA for the sole purpose of giving customers the cleanest credit file possible.

    The idea behind the service is to give customers the best chance of getting approval, secure a lower interest rate or reduce the upfront fees that can be associated with obtaining credit.

    Doessel’s life experience, as both a broker and as a consumer at the wrong end of consumer credit reporting, drove him to create MyCRA Credit Rating Repairs from the ground up.

    After extensive study of Australian credit reporting legislation, he was able to come up with a framework to correct credit rating errors.

    It was now possible to work on behalf of a client and actually repair their credit rating, instructing creditors to remove negative listings where they were listed incorrectly or unfairly.

    That’s how MyCRA Credit Rating Repairs was born.

    According to Doessel, the most challenging part of starting up was getting leads and contacts, but this forced him to be creative and resourceful, particularly on a tiny budget.

    “There is a massive demand for what we do at MyCRA. The barrier to entry is very high but MyCRA overcame all of those challenges on limited to no budget,” he says.

    Doessel says the best part of starting his own business is “doing something that can make a tremendous difference to the lives of so many people, and getting paid to do it”.

    He is now an active executive member of the Credit Repair Industry of Australasia and has interests in a direct debit service firm,” the website reports.

    The recognition from the Start-Up Smart Awards has been significant, with Start-Up Smart also placing MyCRA Credit Rating Repairs amongst the Top Ten new trends for 2012 in the finance category.

    “As the banks toughen their lending criteria, the finance industry is witnessing the emergence of a new type of business – one that aims to make it easier for consumers to obtain credit and finance.

    My CRA, which appears at number 24, was developed for the sole purpose of giving customers the cleanest credit file possible.

    The idea behind the service is to give customers the best chance of getting approval, secure a lower interest rate or reduce the upfront fees that can be associated with obtaining credit,” Michelle Hammond reports in the article 10 trends from the 2012 StartupSmart Top 50.

    The MyCRA Credit Rating Repair mission is to empower people through negotiating the removal of listings, thereby restoring integrity allowing their clients and their families to regain control over their future.

    The reason consumers very often need help when removing listings is two-fold. Firstly, their often limited knowledge of credit reporting legislation (and lack of time to get to know it) leaves them unsure of how to apply the letter of the law in their own circumstances.

    Secondly, negotiating with creditors can be tricky. Clients have to know who to talk to and the way to talk to them. Sometimes people can do more harm than good when trying to fix their own credit rating.

    MyCRA looks after clients who are facing identity theft or Identity Fraud; those with default listings incurred during separation from their spouse or other partners; some have been disputing the bill which went to default stage and many people are just victims of the fallout from inadequate billing procedures – wrong names, wrong addresses, human and computer errors.

    Under current credit reporting legislation, consumers are entitled to obtain a free copy of their credit report from the credit reporting agencies once a year.

    But if people find inconsistencies on their credit report, they can run into difficulty.

    Listings are not removed by creditors unless the credit file holder can provide adequate reason and lots of evidence as to why the listing should not be there.

    Credit rating repair requires knowledge of the legislation, lots of evidence and perseverance. But for those people whose financial freedom is hindered because their credit file contains errors, it is a point worth fighting for.

    MyCRA was founded as a means of championing for the underdog in these situations. The company believe everyone should have the right to redress for mistakes in the credit reporting industry.

    For the future, MyCRA is hoping to increase their level of success by improving the frequency of removal and closing the gap on their current default removal rate.  My CRA has a previous track record of up to 91.7% of cases having a default removed.

    The team hope to accomplish this through further increasing skill level and team numbers, building even better relationships with creditors, and continuing to educate consumers on credit reporting.

    With CEO Graham Doessel’s heavy involvement with the Credit Repair Industry Association of Australasia (CRIAA) as an executive member, MyCRA has a strong policy of maintaining consumer advocacy and industry standards.

    MyCRA is proud to be a part of building a set of regulations for the credit repair industry through the CRIAA. They see the introduction of the CRIAA as a catalyst for enforcing change and bringing about a set of standards which will revolutionise the credit repair industry in Australia and New Zealand.

    MyCRA is also proud to be a Premium Corporate Partner with the Finance Brokers’ Association of Australia (FBAA).

     

  • Older Australians at risk of cybercrime: Super funds a prime target

    Personal information has become a valuable commodity in cybercrime circles. It can be extracted, abused and traded for identity theft purposes and to take advantage of someone’s good credit rating. And as many older Australians are finding out – it can also be pilfered to make some crook wealthy through hijacking Super Funds – without the victim knowing a thing about it.

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

    Australian Federal Police warn that older Australians may be susceptible to identity theft, phishing and data mining activities and in particular Superannuation Fraud, according to Technology Spectator.

    Its article ‘Super funds under threat from cyber criminals: AFP’ also reveals that this susceptibility is coupled with a lack of protection around identity verification with self-managed super-funds.

    An Australian Federal Police submission to the Joint Select Committee of Cyber Security recommends wider education about internet awareness for older Australians.

    The AFP says the combination of wealth and size of this population demographic is tempting for fraudsters:

    “Seniors citizens are accessible, they represent the fastest growing demographic in our ageing population and they hold a large portion of Australia’s wealth. Therefore, they are an attractive potential target for, and may fall victim to, an array of scams and frauds,” the AFP said in their report.

    In June last year we blogged about the growing trend of hacking super funds in a post titled ‘Identity theft News: Latest Warnings and Recommendations’.

    At the time, NSW Police had advised the public of a scam targeting Super Accounts, where fraudsters were stealing enough information from unsuspecting victims to transfer their Super into self-managed funds which could then be easily accessed by the criminals. In effect, criminals were hijacking Super funds.

    Fraud Squad Commander Detective Superintendent Col Dyson said “Superannuation fraud…works well because no-one checks their super…victims rarely notice account changes, making it easy for criminals to change mailing addresses.”  Read more on this story ‘Crooks siphon super funds,’ on CRN Australia’s website.

    Unfortunately, unlike bank fraud, there is no obligation for superannuation funds to reimburse victims, and if the fraud occurs on overseas shores, there is unfortunately very little chance of recovering the stolen money.

    There is also the chance that personal information may be further abused by fraudsters taking out credit in the victim’s name once the Super transfer is successful. This can lead to a series of defaults and bad credit history, which can be hard to recover from.

    People should contact Police for what to do if they have been a victim of Superannuation Fraud or any form of identity theft.  They may advise of the victim’s possible eligibility for a Commonwealth Victims of Identity Crime Certificate, which would at least aid in talking to creditors when the victim attempts to remove their bad credit history and recover their good name.

    People should also check their credit report for any signs of misuse – changes in contact information, strange credit enquiries they didn’t initiate and even new credit can all be signs of identity theft. A credit report is free every year, and can be obtained from the credit reporting agencies.

    For help with identity theft recovery, or for more information on identity theft and how it can affect a person’s credit file, contact MyCRA Credit Rating Repairs on 1300 667 218 or www.mycra.com.au.

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