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Your Credit Report – Much More Important Than You Think

Tony Negline
16th November, 2014

When you apply for any loan (including credit cards) or you want to take out a phone or internet contract or connect the gas or electricity to your home, a key aspect is your credit report.

In Australia we have four credit reporting agencies. Each may hold different information on you.

As your loan, telecommunication or utility application will be made or broken by the contents of these reports it’s a good idea to know what the report will say.

Here’s a summary of the information you’ll find on a credit report:

  • Your details – age, date of birth, driver’s license number, employer etc
  • Prior credit checks made by lenders
  • Details of your current creditors and the type of loan you have with them; for example, credit card, personal loan, mortgage etc
  • Details about your repayment history and overdue payments related to these loans and other arrangements such as unpaid phone bills. Anything at least 60 days overdue is highlighted
  • Legal information made public by the courts – for example, bankruptcy and court judgements issued against you, directorships, etc
  • Details of bad debts or unpaid bills

How often should you check your credit file?

You need to do this as a precaution against mistakes and identity theft at least once per year even if you aren’t intending to take any new loans out.

Overdue Accounts

As noted above these are highlighted on your report. Once you’ve paid any debt listed then the lender or creditor is obliged to update each credit reporting agencies’ data. However each overdue listing will stay on your report for five years.

Lenders view defaults on bills very negatively even after they’ve been paid.

Serious Credit Problems

These will occur when a credit provider can’t contact you about an unpaid debt. These remain on your credit file for seven years. However if they’re paid then they will be listed in the overdue section of your report and will remain on your report for 5 years.

Repayment History Data

From mid-March 2014 the following information will appear on your credit file:

  • Type of credit account – eg credit card, personal loan etc
  • Dates when the loan was taken out and closed
  • Credit limit – that is, the maximum you can borrow
  • Monthly repayment history – have your paid the minimum by the due date?

At this point in time this data is only made available to banks and other credit providers. It isn’t made available to telecommunication or utility companies.

Where to get your credit reports

In a future article we’ll discuss what to do about fixing problems in your credit file.

Tony Negline
ADF Financial Services Consumer Centre

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