MyCRA Specialist Credit Repair Lawyers

Tag: free copy credit report

  • The 7 worst mistakes you can make with credit which can lead to defaults

    What are some of the big mistakes made with credit which could lead you into battling debt and having creditors sending letters of demand and listing defaults on your credit file? We look at the 7 mistakes with credit that could increase your changes of getting bad credit history.

    By Graham Doessel, Founder and CEO of MyCRA Credit Rating Repairs.

    1. Leaving no room for emergencies

    Borrow within your budget. If you have a revolving line of credit or use credit cards you will need to be disciplined. Consider what you can afford and try to live frugally, rather than spending right up to your credit limit. It’s important to realise that you will pay at some point for the credit you use. If you are consistently struggling to make your repayments – then it’s time to take stock of things. Many people get into trouble with their repayments and end up with defaults on their credit file because – well – life happens and they haven’t left any room in their repayments for saving or for emergency funds. Try to separate wants from needs when you borrow.

    2. Thinking you need a large credit limit

    Ignore what the card company or bank sets for your limit – what can you comfortably afford to repay? If you intend to apply for further significant credit in the future, you will need to consider that a lower credit limit looks better to a prospective lender – so if you don’t need it – consider reducing it.

    3. Redrawing on your loan

    If you have a redraw facility on your loan – the temptation can be high to borrow against it. But you should tread carefully here. Remember you are going to be paying interest on this money – you may be better to just save it from your wages. Credit cards can also offer cash advances, but do bear in mind the interest charges on this money are exorbitant. Cash advances are a common way people can blow out their credit card debt to epic proportions leaving them no way to pay, and with defaults which destroy their ability to get new credit for 5 to 7 years.

    4. Choosing the wrong kind of credit

    Make sure your credit suits you. Make it work for you, not the other way around. What kind of payer are you? What do you need the credit for? There’s no point getting a line of credit if you are the big-spender type – you are certain to get into trouble. These types of facilities only work if you are disciplined with your spending. When you choose a credit card – consider what you need it for. If you are going to use it a lot – perhaps the rewards points could be a deciding factor. But if you are only going to use it sporadically – maybe the annual fees should be more important.

    The same goes for any big ticket item you purchase using credit – like houses and cars. What does it need to do for you? What can you actually afford? How long will you need it for? Remember a car always depreciates in value. And whilst houses can make you money in the right market, and possibly a 4 bedroom ensuite home might be a good long term investment – can you actually afford to live comfortably with this debt? If you need to go down to one income at some point – how will your repayments look then? It can cost you thousands in agent’s commission, stamp duty and legal fees to sell if you decide you have bitten off more than you can chew after you move in. Or if you default on your repayments you will probably be unable to borrow for years to come – so choose wisely.

    5. Repaying only the minimum amount

    On credit cards, you should pay off the entire credit card balance within the interest free period to avoid the high interest charges. 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. This can see some people come unstuck and their credit card debts can snowball with interest until they reach the point where they are unable to pay and begin to get into arrears.

    You can find low interest credit cards, but it is still advisable to 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. There may not be as many ‘perks’, but the lower interest rate should mean the carried over debt is more manageable for you, and will prevent possible bad credit history.

    Likewise on any other type of loan that you actually want to pay off – paying the minimum amount will not get you there. You will need to pay a significant amount more to start paying into the principle – especially in the early days of the loan.

    6. Not Checking Statements

    You should check that your credit and debit card statements are correct every month – and query anything you’re not sure about. Maybe you were charged twice for an item, or charged too much. It is a good way to be alerted early to identity theft as well. You should also check your bank account statements in the same way.

    Checking your statements will also allow you to get a good handle on just where you’re spending too much and allow you to adjust your spending next month to compensate.

    7. Not Checking Your Credit Report

    Most people don’t know that every year they are able to request a copy of their credit report for free from Australia’s credit reporting agencies. This report is important, because it shows you how you will be viewed by lenders if you ever apply for a loan. You should check that all of your personal details are correct. You should check the credit enquiries are valid (id theft risk). You should also check to see whether you have any negative entries against your name. Defaults, Clear-outs, Judgments, Writs can all mean you will be refused credit if you apply.

    If you don’t believe the credit listing should be there, if you didn’t know about it or you think there might be a mistake, then the worst thing you can do is leave it there. It will mean you are locked out of mainstream credit for between 5 and 7 years – depending on the listing type. It will often mean you are told by Creditors and the agencies that the bad credit is there to stay for the term – it can’t be removed. But this may not be true.

    For professional advice on how to tackle Creditors and the credit reporting agencies about a listing which should not be there, a credit repairer will be able to determine whether your circumstances would allow for repairing the credit rating and actually negotiating the removal of the bad credit history from your credit file.

    If you want to see what is said about you on your credit file, you can contact MyCRA Credit Rating Repiars to request a free copy of your credit report. We can also help to repair 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.

    Image 1: adamr/ www.FreeDigitalPhotos.net

    Image 2: David Castillo Dominici/ www.FreeDigitalPhotos.net

     

  • Telcos may be forced to reign in their mobile roaming charges

    Going overseas? Often you are told to be wary about using your mobile in case you are charged for international roaming. And with good reason – many clients get what’s commonly called “bill shock” after returning from overseas. But it was announced last week that the government is cracking down on these charges. We look at what this means for you and your credit file.

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

    Recently we gave you a breakdown of things to look out for with your credit file when traveling. In this blog post, titled How An Overseas Trip Can See You With Bad Credit we looked at ways in which you could be at risk of getting a bad credit rating when traveling overseas. Number 3 on the list of ways you can cop bad credit on an overseas trip was phone charges:

    Many phone companies charge you extra for calls you make and receive while you are o/s. Call your telco provider and make sure you know all the facts before you take your phone on a holiday with you. It might be better to get an overseas phone or SIM for your trip instead.

    We help a number of clients who have had a default or other credit listing placed on their credit file during or after the course of a bill dispute following what customers call “excessive” “outrageous” and “unfair” mobile roaming charges which see them with whopping phone bills they either can’t pay or refuse to pay.

    But it seems telcos may soon be forced to reduce their mobile roaming charges.

    The Australian reports in its story New Move to Cut Mobile Roaming Charges,that the Australian and New Zealand governments have combined to stop telcos on both sides of the Tasman from hitting travellers with excessive mobile roaming fees.

    Communications Minister Stephen Conroy and New Zealand Communications Minister Amy Adams today released a draft report that looks at ways to cut charges and improve transparency.

    “The draft report makes it clear that telecommunications companies are stinging consumers on trans-Tasman mobile roaming charges and that their profit margins are excessive,” Senator Conroy told reporters in Canberra.

    The findings have already prompted the federal government to protect Australians travelling further abroad.

    The Australian Communications and Media Authority (ACMA) has been told to create an industry standard for mobile roaming so charges for call, text messages, internet surfing are transparent.

    Senator Conroy said the standard should be in place within a year.

    “One of the most common complaints that I hear is from people who return from overseas and are confronted by a mobile phone bill that runs into the hundreds or even thousands of dollars,” he said.

    Both Ministers said the frequency of travel between nations highlights the need for common and reasonable pricing for international roaming.

    They are now seeking feedback on the draft report from the telecoms industry, ahead of formulating their final responses.

    In the meantime, there are many who are currently facing these billing issues. The important thing to remember is – whenever any changes are made or agreements are reached, whether it be with your billing charges or your accounts, or when going overseas, you should always request things be sent to you in writing for confirmation.

    If you are worried about what may have been reported about you on your credit report, you are entitled to obtain a copy of your credit report for free from the credit reporting agencies in Australia (you can do this once every 12 months). A report will be mailed to you within 10 days of your request.

    If you think a default on your credit file is wrong, or you want to dispute your credit report, contact a professional credit repairer to discuss your suitability for credit repair. If the credit listing is incorrect, contains errors or just shouldn’t be there, a credit repairer can help prepare your case and give you the best chance of having the default or other mistake on your credit file completely removed so you can apply for credit with a clean slate. Contact a Credit Repair Advisor at MyCRA Credit Rating Repairs on 1300 667 218 or visit our main website www.mycra.com.au.

    Image: adamr/ www.FreeDigitalPhotos.net

  • How an overseas trip can see you with bad credit

    Going overseas? We tell you why this makes you vulnerable to being lumbered with bad credit, and tell you 5 things you should know to protect your credit rating when going overseas.

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

    You’re on that plane – drink in one hand, a copy of Lonely Planet in the other. It’s the trip of a lifetime, you’ve scrimped and saved for ages to get to this point – so excited to be heading off on your round-the-world-trip – with an extended stopover in the U.K. for some work. So long suckers!!!!

    You’ll miss your family and friends, but it’s your right of passage to do what millions of young Australians do every day, jump on a plane and see the other side of the world.

    But you are planning on coming back some time, right?

    And watcha gonna do when you get back?

    Get sensible again? Maybe save for a house?

    Or save for another trip?

    But thousands of young people find that one little thing can stop them taking out a mortgage, buying a car, or buying another plane ticket after they have been o/s – BAD CREDIT! And this is often why…

    You come back home a little paler, a little chubbier, a bit wiser, but a hell of a lot poorer. You apply for a credit card – but you nearly fall off your chair – the application is declined. For some reason – you have a Telstra default on your credit rating.

    “This has got to be a mistake!” You say, “I’m good for it – I always make my payments on time.”

    But there it is – bad credit – and there’s nothing you can do about it.

    After contacting Telstra, you find out it was the mobile phone account you had before you went overseas. There was this one last bill that you didn’t know about. And that bill was sent to your old address – again, and again, and then they put a default on your credit file when you didn’t pay it after 60 days.

    You thought you had fixed everything up, but it seems you hadn’t.

    Now the bill has tripled in size, and when you complain about the mistake on your credit file, Telstra tell you all they can do is mark it as paid if you pay it. It will be on your credit file for 5 years.

    This is the scenario of many of our clients who contact us to help dispute their credit report. Time and time again we see people who have gone overseas or even just gone to the next suburb and think they have settled accounts prior to leaving, only to find those ‘final accounts’ haunting them in a big way for years to come.

    Other people have gone overseas, taken their mobile with them, only to find they are hundreds of dollars in debt with no way to pay due to their phone bill.

    Well, before you take off – here are 5 things you should know to protect your credit rating before going overseas:

    1. Completely finalise your accounts

    Contact every creditor to let them know you are going overseas, and provide them with new contact details for you if you are moving out of your home. If you are going for an extended period of time – rather than just paying your last bill, make sure you have finalised your account and requested a closing balance. Once you have paid the final amount, get it in writing to ensure it is the final bill for that account.

    2. Cancel direct debits

    If you have a direct debit set up, this can sometimes be with a separate company to the actual Creditor – particularly with things like gym memberships, so make sure you cancel any direct debits coming out of your account – finalise any outstanding amounts – and get the notification of the cancellation in writing.

    3. Beware phone charges while overseas

    Many phone companies charge you extra for calls you make and receive while you are o/s. Call your telco provider and make sure you know all the facts before you take your phone on a holiday with you. It might be better to get an overseas phone or SIM for your trip instead.

    4. Beware splurging on credit cards

    It can be hard to keep a tally on what you’re spending while you’re overseas. But do check your balance regularly to make sure you’re not blowing out your budget and sending yourself into debt when you get back. And while you’re there, you might want to check for this….

    5. Beware identity theft

    Just because you’re in holiday mode, doesn’t mean your privacy should be as well. Your personal information is a goldmine for fraudsters, and while you’re in transit, you can be vulnerable to identity theft. If identity theft leads to fraud, you can even have credit taken out in your name, and land in all sorts of trouble with your credit file with incorrect defaults and late payments against your name.

    Keep belongings and personal information (especially Facebook logins) secure, and check all ATM’s and credit card machines for skimmers. Check your credit card online when you can regularly and watch you are logging in through a secure site. When you get home, grab a free copy of your credit file straight away. If there are any suspicious entries you may have been a victim of identity theft.

    Checking your credit file

    If you have come home from an overseas trip, and want to check what your credit file says about you, you should know you are entitled to a free copy of your credit report once a year from Australia’s credit reporting agencies.

    It might be a good idea to order this copy of your credit report prior to applying for any new credit and it will be sent within 10 working days. It will tell you whether you have any bad credit, or whether there are any mistakes on your credit report.

    If you think a default on your credit file is wrong, or you want to dispute your credit report, contact a professional credit repairer to discuss your suitability for credit repair. If the listing is incorrect, contains errors or just shouldn’t be there, a credit repairer can help prepare your case and give you the best chance of having the default or other mistake on your credit file completely removed so you can apply for credit with a clean slate.

    Image: kangshutters/ 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