Credit reports a mystery to most...

An article in the Daily Telegraph on Monday 27 January, 2014 caught our eye earlier this week. We thought our readers might be interested in some of the key points from this article written by Telegraph writer Sophie Elsworth:

'The majority of Australians have no idea what credit reporting is or understand the critical role it plays in accessing more credit.

Despite the nation's biggest overhaul of credit reporting laws beginning in March, about 59% of consumers do not understand how the system works. A credit report can be accessed by lenders, including banks, credit unions and utility companies to track an applicant's credit history and determine their ability to access more credit.

Under the new laws, lenders will be able to access a much bigger dossier on people's credit habits and focus not just on negative information, including defaults, bankruptcies and court judgements, but also positive information about an applicant, like a person's ability to pay back a loan.

Credit reporting agency Veda's general manager of consumer risk Angus Luffman urged Australians to take the time to check their own credit reports, which can be accessed for free, to ensure it's accurate. "Knowing what's on your credit file is a good thing, but our surveys indicate there's not a good understanding of credit file and content among the broader population".

To access credit files visit www.mycreditfile.com.au or www.dnbcreditreport.com.au. ARCA's new website to help consumers understand credit reports can be visited a creditsmart.org.au.'

We thought this is a very interesting article and a good reminder to be aware of your credit file status as people sometimes don't realise there is a "black mark" on their credit file until they undertake a major purchase such as a car loan or home loan. If you would like to talk to us more about this please call our office (02) 4367 7277.

Enjoy your day!