Can I Still Fix My Credit File?

This is a question we are often asked by our clients.

There have been a number of changes to credit reporting legislation recently.  Many of these changes are in my opinion positive and were well overdue.  For the most part they have been welcomed by credit providers and the general public but having said this, change is never easy and reform with credit reporting has generated its fair share of uncertainly and controversy.

New Reforms to Fix My Credit File

Prior to these changes to credit reporting, very limited data was held in a credit file.  This lack of data was apparent in the case of a credit enquiry or application.  When a consumer applied for credit, commonly over the phone or internet, the application would be recorded on their credit file however only the name of the company, the date of the application and possibly the amount applied for was recorded.  Critical information such as if the credit was approved or declined was not included.

This lack of information led to credit providers not having a clear picture of an applicant’s true financial position.  Due to this many credit applications were declined not because the borrower had negative credit listings or a poor credit score but because the credit provider was unable to get an accurate picture of the applicant’s financial position and therefore were unable to apply the correct risk profile.

Fix My Credit File!

New credit reporting reforms have addressed this problem as critical data such as if the application was approved or declined is now recorded in a credit file.  This information now allows credit providers to determine how much credit the applicant actually has and therefore if they are able to afford more credit.  Such information will help credit providers make better decisions and make sure they are lending responsibly.

The ability for a person to fix their credit file is based on being able to determine if the negative credit listing is faulty or wrongly listed and therefore contestable, this is the basis of credit repair.

Prior to a credit provider listing a negative credit recording such as a payment default they must follow a strict process and correctly inform the borrower of their intentions.

In general an account must be at least 60 days in arrears before a default can be recorded.  The credit provider must also issue a correctly structured demand notice to the borrower that notes the amount owed, how to pay and the ramifications if the matter is not resolved.  The credit provider must also provide details of their external dispute resolution scheme such as the Financial or Credit Ombudsman.

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Contest Your Credit Report

If it is found that any part of this process was not correctly followed the offending credit listing may be contestable and therefore it may be able to be removed from a credit report.

The new credit reporting laws have not changed this fact so people are still able to fix their credit file given the listing is shown to be incorrect or faulty.

There is nothing stopping someone trying to fix their own credit file or contacting the relevant industry ombudsman, however the services of a reputable credit repair company should also be considered.

How to Fix My Credit File

A professional credit repair company will understand the laws surrounding credit reporting and will have established relationships with credit providers and that is often what is required to achieving a positive outcome when trying to repair a credit file. For assistance cleaning up your credit file contact Clean Credit and just say fix my credit file!

 

John Dickinson

Clean Credit Pty Ltd