Comprehensive Credit Reporting
It’s not wise to be even one day late with your repayments – even more so now!
If you’re of the opinion that it’s OK to be a few days late with your loan or credit card payments because no one is on your back about it, then it is time to rethink.
Before March 2014, credit reporting content consisted of ‘negative’ information about a customer’s credit history. It would basically show credit applications made, loan defaults, bankruptcy, court orders and judgements but did not contain any positive information for borrowers who were managing their credit well.
In March 2014, Australia’s Privacy Act legislation changed allowing Credit Providers to share additional ‘positive’ consumer credit information relating to their customer accounts through Credit Reporting Bodies. It’s now allowed to also include information highlighting if a customer has managed their credit will such as account type, open and close dates, 24 months repayment history (payments made as well as missed) and Current credit limit/maximum amount of credit.
Lenders are slowly starting to report this. NAB and PLANLend are doing this; BankWest and the Commonwealth Bank have been reporting credit card payment history for a few months but all lenders will follow during the year.
CCR will allow lenders to have a better understanding of customers’ external debts (limits) as well as the behaviour of the debt (24 months’ of repayment history) so, as an example, If a customer has a ANZ credit card, lenders will know the limit of the credit card as well as the repayment history for the last 24 months.
This will be significant.
This will apparently also be used by organisations such as electricity providers before they decide whether to provide credit so even being one day late with a repayment will be clear to anyone who accesses your file that this is the case.
It’s a great idea to check your credit score now and see the new reporting. There are different versions around but the one that we have used is https://www.creditsimple.com.au/
Don’t underestimate the power of Comprehensive Credit Reporting.
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