MyCRA Specialist Credit Repair Lawyers

Tag: default on credit file

  • How do I fix my bad credit?

    In this day and age everything works on credit. If you cop a default on your credit file – you will be refused credit with mainstream lenders (at affordable interest rates). If you do get a loan, often the interest rate is much higher. You may also find you can’t get credit cards or mobile phones on a plan. So you can’t afford to let bad credit history stand in your way – especially if that credit listing shouldn’t be there. Let’s look at what you can do if you want to fix bad credit.

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

    If you have bad credit – you have two options….

    1. You can attempt to remove the default or other credit listing yourself, and there are processes to do this – OR

    2. You can use a professional credit repair service.

    The benefit in fixing your own bad credit is that it’s cheap. You may have very little costs associated with disputing your own credit listing. But similarly to defending yourself in Court – the cheap option may not be the best one for you.

    Credit rating errors are quite common, and the onus of ensuring the accuracy of your credit file rests with you. But how do you know if a listing has been placed accurately on your credit file, or if it should be there in the first place?

    There are strict codes of conduct and legislation which must be adhered to when your Credit Provider is placing a default or other credit listing on your credit file. These laws are in place to protect consumers from unfair and damaging credit reporting. Creditors are largely aware of this legislation (yet may not have adhered to it), but there are very few consumers who are well-versed in credit reporting and industry legislation.

    In order to dispute a credit listing which you believe shouldn’t be there, you must identify where the Creditor has not adhered to current legislation when placing the notation on your credit file. There is a whole barrage of points which need to be met in order to constitute a valid listing, and if you have not been made aware of all the avenues for dispute, then you could be doing yourself and your case a disservice.

    A professional credit repairer will often dig deeper to conduct an audit-like investigation of your credit complaint to uncover errors or non-compliance.

    What’s the process for a credit repairer to fix my bad credit?

    Credit repair is not an exact science, because every case is different but there are some common threads which run through credit reporting law which we follow.

    Firstly, we order a free copy of your credit file on your behalf from one or more of Australia’s credit reporting agencies which tells us exactly who and what we are dealing with in relation to the bad credit.

    Then we investigate any avenues for disputing your credit listing or listings with your creditor. This involves requesting documentation from your creditor about your account. The creditor can at times take a while to provide the information they should.

    Then the information we receive is cross-referenced against the appropriate legislation for potential compliance errors.

    Then we formally communicate with your creditor to request the removal of what we would then deem to be a listing placed on your credit file unlawfully. This process can be a bit ‘back –and- forth’, as there are procedures that we, and they have to follow in accordance with industry and the law as well as negotiations which take place behind the scenes with creditors. The complaint may also need to be escalated to a higher authority such as an industry Ombudsman if there is no satisfaction with the creditor.

    If the creditor agrees to remove the listing, we ask you to contact the credit reporting agencies at a later date to confirm it has been removed. (You don’t generate a credit ‘enquiry’ on your credit file if you request the information yourself – and too many credit enquiries could see you refused a loan).

    How long will it take to fix my bad credit?

    The length of time it will take to remove bad credit from your credit file is very much an unknown factor.

    It could depend on the particular facts relating to your application, including the evidence required to support each party’s claims; on the amount of cooperation we receive from your creditor/s including how quickly they respond to our requests; on the number of issues raised in your application; the volume and relevance of information and supporting documents provided by you and the complexity of the legislation relating to your particular defaults.

    At MyCRA Credit Rating Repairs, the costs involved are not based on the amount owing nor the time it takes to remove the listing, but are on a per-listing basis. For more information on costs, visit our main website www.mycra.com.au.

    Warning

    Not all credit repairers are the same.

    What makes a good Credit Rating Repair Company?

    1. Transparency

    You need full disclosure of fees and charges up front. You need to know exactly what the service will cost before you spend a single cent. Are there any Guarantees in place, what about refund policies. Then, is it all written down?

    2. History

    Are there testimonials, and can you verify them? Anyone can write a testimonial, but are they willing to put their name on it and have you call them? If you can’t call the person that’s raving about the Credit Rating Repair Company, how do you know it is a real testimonial and not just made up?

    3. Expectations

    What are your chances of success, what are the refund policies, how long is it going to take? These are all questions that you should be able to answer before you speak to anyone. This information should be published on their website.

    In addition to these 3 items, there are a few others to check on as well.

    -Are they a “One Man Band”?
    – Do they have the resources to do what they say they do?
    – Is it a Registered Company or just a business name? (how to check..)
    – Are they registered with the ATO (Australian Taxation Office) for GST (Making more than $75,000 PA requires registration) (How to check..)

    The main message here is:

    Before you hand over your hard earned cash, make sure you do your homework and know who it is that you are dealing with.

    MyCRA Credit Rating Repairs publishes costs, product information, is fully registered, has the resources and experience, has verifiable testimonials, is registered for GST, and is an established business in Both Australia and New Zealand. You can speak to MyCRA for FREE and if we don’t think we can help, we won’t charge you a thing.

    If you’d like to speak to a real person about how we can help fix your bad credit, contact a Credit Repair Advisor on 1300 667 218.

    Image: David Castillo Dominici/ www.FreeDigitalPhotos.net

     

  • For those about to default on their home loan

    A recent survey on Australian Mortgage Stress has revealed a fifth of first home owners risk defaulting on their mortgage in the next few months – are you one of them? We look at who might be vulnerable to mortgage stress, why you want to avoid defaulting on your home loan, and what you can do to prevent things reaching that stage.

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

    An ‘Australian Mortgage Stress Analysis’ survey released last week shows almost 20% of the 26,000 Australian households surveyed were under mortgage stress.

    The results from Digital Finance Analytics (DFA) showed 16% of those homeowners surveyed currently fall into the ‘severe mortgage stress’ category.

    Those in Tasmania are leading the crisis with 17.2 per cent falling behind in repayments, being driven to refinance or pressured by banks to sell. This was closely followed by Northern Territory (17 per cent), New South Wales and South Australia (both 16. 4 per cent), Victoria and Queensland (both 16 per cent), ACT (15.2 per cent), and Western Australia (14.4).

    Digital Finance Analytics says rising household costs and budget blow outs can land first-home buyers in hot water.

    The survey showed the number of suburban homes in the severe mortgage stress category will rise by 4000 from 43,600 by June 30 next year.

    How could I be affected by defaulting on my home loan?

    Obviously, if you default on your mortgage for a certain period of time, you risk the bank taking the home. But even if you default once, but then begin to make up the repayments you are still putting your future at risk.

    If you fail to make repayments on our loan past 60 days, the bank will make a notation on your credit file – a ‘default’ credit listing. Once you have a default against your name – it will stay there for 5 years. The intention of adding default credit listings to credit history is to warn future credit providers you would potentially have trouble keeping up with repayments. Likewise, as part of ‘responsible lending’ it would mean the credit provider would be acting irresponsibly to lend you money – so most don’t.

    A default on your credit file means you have very little access to mainstream credit for the five year term. If you really need to borrow money – you may be able to get a non-conforming loan – but that’s going to be at a much much higher interest rate. You may also find it difficult to access all secondary forms of credit – such as mobile phone plans, credit cards and store credit. This is how people end up going for alternative loans and paying massive amounts of interest. If you fall into this cycle (and sometimes there can be no choice) you can often end up getting into more and more debt without the funds to climb out of it.

    This credit lockdown is the very reason why people with legitimate credit rating errors seek help through a credit repairer, and fight so hard to have those credit listings which shouldn’t be there removed from their credit file. Our society works on credit, so it is often very difficult to live with defaults or other adverse listings on your credit file.

    So to avoid this ‘debt cycle’ through living with defaults on your credit file, what you want to do is avoid defaulting on your home loan (or indeed any other forms of credit) at all costs.

    What can I do if I am experiencing mortgage stress?

    Yesterday Sydney Morning Herald’s Money section featured some great advice for people in the situation of mortgage stress in their story Tell them to cut you a break. The article gives you some great practical tips on what to do to reduce the size of your mortgage payments, which should hopefully help to reduce the strain on your household and allow you to get back on track without resorting to missed payments.

    The article was all about speaking up, and asking the banks for what you need. Recently there have been some big moves to increase competition in the mortgage market place, through for instance banning exit fees. This may mean your bank is more willing to reduce your interest rate:

    If your loan is with a big bank and you’re paying the advertised interest rate, you’re being ripped off. It used to be that customers who knew to ask could secure 70 basis points off that rate, but in recent competitive times, that discount has leapt to as much as 100 basis points.

    You won’t be able to get any reduction from one of the new breed of online lenders; it’s their cut-price rates that are forcing discounting elsewhere. But banks, and even some building societies and credit unions, will have wiggle room. The beauty of this information is that you could use it to make an instant saving with your lender, sparing you from having to remortgage.

    Be warned, though: getting the full 1 per cent might require a genuine threat to leave. And even then, you may have to play the ”I’m a long-term, loyal customer” card, the SMH article says.

    If this doesn’t work – the article advises threatening to leave (but beware exit fees if your loan was taken out prior to Jul 1, 2011).

    A report by the Australian Securities and Investments Commission found that more than 50 per cent of people who complained about an early-termination fee saw it reduced or waived. However, the survey of 20 lenders found fees were still levied in 75,000 cases between July 1, 2010, and February 15 last year.

    So it’s the knowledge of the deals banks are doing that will save you.

    If you are in severe financial strife which won’t be helped with a slightly reduced interest rate – then it’s time to tell put up your hand and tell your bank.

    ”No way – keep it quiet for as long as possible,” I hear you say, and I understand that rationale. But you also have to realise that your lender doesn’t want you to default. They’ll lose all that lovely interest you’ve signed up to pay, and if the situation becomes so drastic that they sell your house from under you, the price they’ll fetch will be paltry.

    The lenders will help you – with revised repayment schedules, spreading them over a fresh 25 or 30 years, and even with interest-rate discounts – because it’s in their interests to do so. What’s more, they made a commitment to the government during the GFC to go easy on borrowers in distress. And today, they’re under more political and public scrutiny than ever,” the same article said.

    How do I apply for a revised repayment schedule with my bank to avoid a default?

    Firstly, you need to make it clear to your bank that you fear if you aren’t able to restructure your home loan repayments that you will fall into arrears. If you have a situation of temporary difficulty, such as unemployment, illness, injury or other reasonable issue which would mean making repayments will be difficult, this is essential to do. You will be requesting a financial hardship variation to your repayments. This may mean your repayments are reduced accordingly and the lender may take action to stop a potential default on your credit file.

    Tips for Applying for financial hardship

    – Work out what you can afford to pay prior to requesting a hardship variation. This would involve taking the bull by the horns and doing up a serious budget on what’s coming in and what your repayments are on all of your credit accounts. Could burying your head in the sand be the main reason why you find yourself in this situation in the first place? If so, it would be a great idea to seek professional help in managing your budget for your entire future. The best place to start looking for some help would be ASIC’s MoneySmart Website. If you feel like you’ll struggle across a number of credit areas in the short term – consider requesting a reduced payment for other credit accounts as well.

    – Put your request in writing and keep a copy as a record.

    – You may need to use the actual words “financial hardship variation” for your lender to officially recognise the request, and to avoid confusion as to what you’re asking for.

    – Check your loan agreement as to the terms you entered into around financial hardship. Those agreements post-1 July 2010 have a clause which requires the lender to respond to you within 21 days.

    – Creditors are legally required to consider a person’s request for variation on payment arrangements, but are not obliged to agree to any hardship variation proposal put forward. If a lender either refuses or fails to respond to your hardship request, you can lodge a complaint with their independent dispute resolution scheme, such as the Ombudsman they are a member of.

    – Research how to apply for financial hardship. You can do this through ASIC’s MoneySmart Website, or through sites like Money Help, a website run by the Victorian State Government.

    A rethink about money

    If you have been accepted for a hardship variation – and you don’t end up with a default on your credit file, consider that you have dodged a bullet. But are you sure you won’t get into any kind of credit stress in the future? This whole episode will be worth it if you are able to learn from what’s happened. My advice on avoiding future defaults? Overhaul your finances and put in place some real changes in how you think about credit – taking a fresh look at ‘things’ ‘wants’ and ‘needs’– and making credit work for you next time instead of the other way around.  Unfortunately this doesn’t guarantee that mistakes won’t happen with your credit file, but it will guarantee that a negative credit listing won’t make its way to your credit file through any fault of your own.

    For help with disputing credit listings which you consider unfair – including where instances of financial hardship have not been recognised – contact a Credit Repair Advisor on 1300 667 218 or visit the main site www.mycra.com.au for more details on your possible suitability for credit repair.

    Image: digitalart/ www.FreeDigitalPhotos.net

    Survey statistics courtesy of Herald Sun Article: First time buyers at risk of home loss

  • Are you spending more than you earn? You’re not alone….

    It was reported yesterday that one in seven households in Australia is on ‘struggle street’ – spending more than it earns. It seems many Australians are living on credit, including some of our richest. We look at the concept of living on credit, and how existing this way can not only put pressure on the household, but when it all catches up and you are lumbered with bad credit history – threaten the family’s ability to get the best credit at the best rates for years to come. We look at how you get there, why you want to avoid it, and what to do about it.

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

    News.com.au featured some interesting statistics put out by the ABS yesterday in its article ‘Aussie strugglers living beyond means’:

    “One in seven Australian households is spending more than it earns, as the working poor struggle with monster mortgages and surging power bills.

    Nearly 8 per cent of the nation’s richest households were living on credit, the Australian Bureau of Statistics reported yesterday.

    Of the top 20 per cent of households earning the most money, 3 per cent could not afford to pay a gas, electricity or phone bill on time during 2009-10.

    Of the poorest 20 per cent of households, one in five could not pay their bills on time and one in four spent more than they earned.”

    Living this way is living dangerously. Often you are said to be robbing Peter to pay Paul. But if something goes wrong, you can run a real risk of getting into arrears. If your accounts fall 60 days behind, then your Creditor will place a default on your credit file – and this will impact you and your family for years and years to come. You will be banned from mainstream credit. The credit you do buy after that will be at a pretty high price. You may not even be able to get a mobile phone on a plan.

    How did we get here?

    Sure petrol prices are ridiculous, and grocery bills seemed to rise no end, and then there are reports out there that people have had to use bbq’s and eskies because they can’t pay their power bill – but the average person can afford these essentials. It’s the luxuries we have issues with – and what we consider to be luxuries and essentials today may have something to do with it.

    A while back, I blogged about the concept of “Affluenza” an idea put out there by Australians Clive Hamilton and Richard Denniss’ in their book, Affluenza: When Too Much is Never Enough.

    Affluenza is a disease of the 21st Century that can make us sick, and it can make our credit file sick with it –pulling us into a crazy cycle of spending and debt. Many of us are struggling to stay happy under a pile of ‘things’ and a pile of debt.

    It is the disease of consumerism and it is being fuelled by big corporations urging us to buy more, persuading us with clever advertising aimed at selling to our emotions. It drives us to work crazy hours leaving no time for ourselves and our families. It drives up the mental health problems, the suicide rates, the divorce rates, the drug addictions, fraud, the stress related health problems – all these things seem to be a curse of living in the 21st Century in the Western world.

    Here is an excerpt from that book:

    “Our houses are bigger than ever, but our families are smaller. Our kids go to the best schools we can afford, but we hardly see them. We’ve got more money to spend, yet we’re further in debt than ever before. What is going on?

    The Western world is in the grip of a consumption binge that is unique in human history. We aspire to the lifestyles of the rich and famous at the cost of family, friends and personal fulfilment. Rates of stress, depression and obesity are up as we wrestle with the emptiness and endless disappointments of the consumer life.

    When I read yesterday that one in seven of us are still living on borrowed money, it makes me realise that not enough Australians understand the power of credit. It is a great concept, but as long as we make it work for us. We should use it to enhance our lives so that we can spend time with the ones we love, or to really improve our quality of life. Not make ourselves slaves to it.

    Maybe we throw that long sought after holiday on the credit card and take the family away? Or take out repayments on an educational course that will change our working lives forever? Or perhaps we do buy a home, but after years of good saving. One that fits all the requirements of what we need, rather than what we want. A home we don’t have to work 24/7 to pay off because it is priced within our means.

    What we shouldn’t do is spend money we don’t have, on things we don’t need, and ultimately find ourselves with what we don’t want – debt, unhappiness and a bad credit history.

    What does your credit file say about you?

    We should think of our credit file as a mirror on our finances. It can reflect our assets, our good history, but it can also reveal our financial shortcomings. It can be a reflection of our inability to stick with something, our disregard for repayments and it shows the financial potholes we fall into that are sometimes impossible to climb out of.

    A bad credit rating can completely change our financial situation. The black marks placed there by creditors show up on our credit file for 5 years. Bad credit can limit our choices and can perpetuate the debt cycle by leading us to choose loans with higher interest rates and more fees, so the struggle to make repayments can be even harder.

    If we want to try and start again with credit, it may be possible to wipe the slate clean, particularly if our bad credit rating should not be there.  Firstly, we can obtain a free copy of our credit report from one or more of the credit reporting agencies, Veda Advantage, Dun & Bradstreet and Tasmanian Collection Services (TASCOL). If after checking our credit file we find inconsistencies, we may be a good candidate for credit repair.

    A credit repairer can work with creditors on our behalf to completely clear our credit file of all defaults, clear-outs, writs and Judgments which contain errors, are unjust or just should not be there. This means we no longer have a bad credit rating, but a completely clear credit file, giving us the financial freedom to use credit whenever we need to.

    The rest is up to us.

    Contact a credit repair advisor on 1300 667 218 for more information on repairing bad credit, or visit our main site www.mycra.com.au.

    Image: hin255/ www.FreeDigitalPhotos.net

     

     

  • Mistake On Your Credit Report? Here’s How To Correct Them

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    Mistake on your credit report? It can be remedied! If your credit file has incorrect information, or the default listing is wrong, we look at what you can do to fix your bad credit in Australia.

    Bad credit is not pretty. Many times people don’t find out about a default or a mistake on their credit file until they are sitting in front of the lender – mortified, frustrated and heartbroken at the loss of a mortgage, business loan or car loan. This ‘bad credit’ listing will remain on your credit file for the next five years, and for the next five years you will be restricted on your access to credit and forced out of the mainstream market. Heck, even a mobile phone plan is looking unlikely. All because a credit provider decided you had been late paying an account.

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

    But what if the creditor has gotten it wrong? What if the wrong information is on your credit file or a mistake has been made on your credit file?

    Firstly, you are not alone. Thousands, maybe millions of Australians are facing this issue of credit rating errors caused by a mistake right now. Some of those people have tried to dispute an unfair credit listing, and many of those people have been unsuccessful. They have been told that credit listings are never removed, that they will remain on your credit file until the ‘drop off’ date. If they have been paid, they can be marked as such, but there will still be some notation on your credit file.

    Don’t buy into it!

    If a credit listing has been placed unlawfully on your credit file, if there is any mistake in any aspect of the credit listing, or the listing just should not be there, then you may have the right to have those inconsistencies removed.

    Some basic things to look for with default listing rules:

    1. More than 60 days must have elapsed since the account was officially in arrears.

    2. You must have received written notification of the default before it was listed.

    If either of these has not occurred, then you should contact the creditor in writing to request the default’s removal – as the creditor has not followed basic rules whilst listing the default on your credit file and it has been ‘unlawfully’ placed on your credit file.

    3. Has the default been listed for more than five years?

    The listing should have ‘dropped off’ your credit file, and you should request the creditor remove the default from your credit file.

    When it’s a little more complicated, or you want to ensure you have the best chance of the incorrect or mistaken listing being completely removed from your credit file, often it is best to seek professional help.

    Dangers In Disputing Your Credit Listings Yourself…

    Often you only get one shot in disputing a credit listing. If you alert creditors in the wrong way that you have issues with a credit listing, there is a danger they may make changes to records to correct the mistake, or delete certain records from their files in order to solidify evidence that the listing was applied correctly.

    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, and this lack of evidence can also let people down in their case for removing an incorrect listing.

    Professional Credit Repair Law Firms

    A credit repair lawyer is uniquely qualified in disputing defaults and other credit listings which should not be there. They will investigate the disputed credit listing, request further information as required and draft a considered complaint to your creditor. They are well versed in the approx. 8,000 pages of legislation which relates to credit reporting, and they can cross-reference this legislation as it applies to your particular case.

    You may have a listing removed due to the creditor not complying with some of the more well-known credit reporting legislation, or a credit repair law firm could find more specific evidence which can aid the case for removal of the credit listing which you may never have found yourself. It is in the investigation and presentation of the case for removal and finally in the negotiation with the creditor that people can see the true value of a credit repair lawyer.

    Credit repair lawyers also know what avenue to take if the creditor refuses to remove the listing, and will if necessary escalate your complaint to courts.

    Who Chooses Credit Repair?

    People choose to use a credit repair lawyer when they don’t have the time, patience, negotiating ability, temper, or knowledge of legislation to dispute their credit listing mistake with the creditor themselves. People who want the best chance of getting a default removed will use a professional experienced credit repair law firm, just as most people would use a lawyer if they were defending themselves in court. It’s a bit like David and Goliath in many cases – so credit repair lawyers like MyCRA Lawyers provide the benefit of their experience to tackle the big guys on your behalf.

    Volume of Credit Rating Errors Or Mistakes

    A Veda Advantage (now Equifax) spokesperson, was recently interviewed by Channel 7 Australia’s Today Tonight, about the possible number of errors which are contained on Australian credit reports.

    “We give out about 250,000 credit reports to consumers every year. But only in 1 per cent of cases is there a material error on the file, so a default or an enquiry that’s incorrect,” Mr Gration told Today Tonight.

    But an 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.

    A similar study was conducted in 2015 and in January 2016, where it was revealed that 12 years on, approximately 30% of credit ratings still contain mistakes.

    We think the current real figure is probably somewhere in between that. But in any case, there are far too many people with inconsistent credit reports and far too many people left in the dark about how to correctly dispute them.

    So it’s important to raise awareness, and show people how to give themselves the best chance at clearing bad credit.

    Image: digitalart/ 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:

     

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