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How clean is your credit file?

By Joe Trimarchi, Solicitor

THE Australian Credit Reporting System is designed to capture information about individuals and corporations with the sole purpose of providing creditors with an accurate and concise picture about  that individual’s or corporation’s credit worthiness; namely their ability to pay back the loan.

Until recently Australia operated on a negative reporting system, in that only negative information such as a default being recorded on a credit file.

Recently Australia has moving to a comprehensive credit reporting system which allows creditors to list a greater volume of information on a credit file.

With an increase in the volume of information recorded comes an increase in the ability of those listing information to make mistakes.

If a mistake occurs the need to fix your credit has become paramount to financial well-being in particular your ability to access finance. More likely than not the answer may lie in credit repair.

Federal Legislation governs Credit Reporting in Australia. It governs the way information is listed on a credit report, and it also allows mistaken entries to be challenged allowing you to fix credit discrepancies legally.    

The Global Financial Crisis (GFC) experienced a few years ago has allowed the major lending institutions to claw back market share of lending whereby by large lenders now account for a greater percentage of lending in Australia.

The increase in power has allowed major banks to position themselves to be able to choose who they lend too by increasing the bar on lending criteria.    

Lenders and debt collection companies use your credit report as a tool to recover outstanding debts; they threaten to list a default if payment is not made.

The law gives them this right; it also gives the consumers right to be able to fix credit discrepancies existing of their credit history.

Exercising this right is sometimes difficult as the rules surrounding credit default listings in Australia are complex and difficult to understand by way of implementation.

To fix your credit requires an in-depth knowledge of how the system works and the law is required. Lenders and debt recovery companies understand the rules and use the same irrespective of the consequences and how these consequences impact upon the consumer.  

An incorrectly listed default or Judgment remains on a credit file for a minimum of (5) years and in some cases (7) years.

Imagine not being able to borrow money, set up a trade account or apply for a mobile phone account for up to (7) years, this would cripple some people as being able to borrow money in today’s society is just as important as being able to access basic necessities such as food and water.     

In recent years Australia has seen the emergence of companies that specialize in fixing credit problems more commonly known as credit repair companies. T

The United States has advanced this area with many companies offering this serve since the early 1990’s. Fixing Credit or Credit Repair in Australia has only been developed as an industry since 2002 -2003.

The emergence of these Credit Repair companies has seen the consumers capable of accessing the expertise of companies that specialize in this field are able to talk the same language as debt recovering companies and lenders and can advocate the rights of consumers that otherwise would be buried in red tape.

What price can be put on credit worthiness and having a credit history that allows you to achieve your goals in allowing you to access finance in order to achieve them? It should be noted credit repair companies can only repair credit files where a listing has been made in error.

If the listing has been made correctly there is little that can be done to assist with its removal.  Most Australians who have borrowed money or applied for even a phone account have a credit file.

Credit Reporting agencies hold in excess of (13) million credit files on individuals or companies in Australia.

Even if there is a small percentage of these credit files that have a mistake or incorrect listing say (5%) this means potentially there are over (650) thousand people in Australia today that would have a valid reason to challenge these incorrectly listed items on their credit file.

Contacta Joe at joe@josephtrimarchi.com.au


Michael Walls
0407 783 413

Access News is a print and digital media publisher established over 15 years and based in Western Sydney, Australia. Our newspaper titles include the flagship publication, Western Sydney Express, which is a trusted source of information and for hundreds of thousands of decision makers, businesspeople and residents looking for insights into the people, projects, opportunities and networks that shape Australia's fastest growing region - Greater Western Sydney.