Want to be in a better position the next time you apply for credit? Discover everything you need to know about your credit file
Your credit file contains information that lenders, and other providers use to assess you when you apply for specific products and services. Your credit file contains a variety of information including personal details, credit accounts you request and accounts you default on etc. It’s essential you understand each part of your credit file and also know what lenders record there, so the next time you apply for credit you are in the best possible position to receive approval. The guide below takes you through what you need to know.
What is a credit file?
A credit file is a collection of information that credit report agencies obtain from credit card providers; banks; mortgage providers and utility companies. Lenders use the financial information in your file to assess your ability to repay debt and manage loans. Also, service and credit providers look at credit files to avoid the risk of lending to known defaulters or people with bankruptcy or insolvency issues. However, if they choose to offer credit to these borrowers, they usually charge a higher interest rate.
What information is in my credit report?
Your credit file contains all your financial information, including repayment history; current debt; commercial and personal loans you apply for and other details that help lenders assess their risk when providing credit. Here are the details contained in a credit report:
- Personal information. Your credit file lists your name; date of birth; current address; where you work; driver’s licence details and gender.
- Default notes. A default note is any details on overdue debt you might have; payments you miss on loans and utility bills, plus other serious credit infringements.
- Information that is public record. This section contains any information that is public record, including bankruptcy notes; court writs and judgments; personal insolvency agreements; directorship or proprietorship information.
- Consumer credit information. These details include credit applications made in the last five years (whether you receive approval or not), credit account types, eg credit card or personal loans; account open and close dates, and the credit limit of these accounts; your monthly repayment history on credit accounts and details of any overdue accounts.
- Commercial credit information. Details of credit enquiries you may make for commercial purposes and overdue commercial credit accounts.
- Joint applicants. If you apply for any loans or credit cards as a joint borrower, lenders list this on your report.
How long is information held on my file?
Following the introduction of comprehensive credit reporting in 2012, credit providers record both positive and negative listings. However, it is the negative listings, such as bankruptcies and overdue accounts, they may list on your file for longer and impacts your ability to access credit. Use the following as a guide to how long listings appear on record:
| Type of listing | Length of time it’s listed (years) | Description |
|---|---|---|
| Credit application | 5 | Any application you make for credit is listed here, eg credit cards, loans, utilities. |
| Inquiries | 5 | Applications made to utility companies, banks or lenders for services or credit products (whether you receive approval or not). |
| Overdue accounts listed as a payment default | 5 | Overdue accounts of $100 or more that is 30 days or more overdue. Collection information, default history, summary instalment orders and judgment records. |
| District and High Court judgements | 5 | Five years from the date of judgement. |
| Serious credit infringements | 5 | From the date of the report. |
| Single bankruptcy | 4 | If you enter into bankruptcy it will be removed from your file four years from the date you receive a discharge notice. Also includes a single record of entry into No Asset Procedure |
| Multiple Insolvencies | May be held indefinitely |
What should I check in my credit file?
When you order your credit file, you should examine the following details:
- Personal information. Ensure all your details are correct, as this limits the chance of identity theft or receiving a rejection for credit because of a misspelled first name.
- Incorrect defaults. Credit reporting agencies or lenders might: List a default incorrectly into your file; record a default twice, or list a default for an account you paid on time. If you find an incorrect default, talk to the credit reporting bureau first, then if that doesn’t rectify it, you should contact the credit provider. We outline a full process for dealing with incorrect listings below.
How can I deal with incorrect listings?
- Contact the credit reporting bureau first. It may be able to remove the incorrect listing or contact the credit provider on your behalf, and they will remove it. If not;
- Contact the credit provider that listed it and explain why it is incorrect. The credit provider should have a dispute resolution team or process in place. If that doesn’t rectify it;
- Contact the Privacy Commissioner. Contacting the Commissioner should be your last stop if the provider’s dispute resolution scheme fails to remedy the issue. Although there is no specific time frame to make a complaint with the Privacy Commissioner, they may not take up your case if, “Investigation of the complaint would be no longer practicable or desirable”. Contact them on 0800 803 909, if you are unsure.
Frequently asked questions
I’ve never applied for a loan or credit card. Do I have a credit report?
Even if you have never applied for a credit product with a bank or standalone lender, you may still have a credit report. If you have a mobile phone contract or hold a utility contract in your name, this is a form of credit. You may also have had interest-free store finance, and lenders list it on your credit file.
Do I have to make a request to remove information from my file or is it taken off automatically?
When it’s time for the credit reporting agency to remove a listing, they delete it for you. If you find they do not remove the listing when it should have been, contact the credit reporting agency and ask them to delete it.
Is my credit file the same with each provider?
There are a few reporting bureaus, and each has access to various sources, so your credit score may be different with each one, but your credit file should remain the same.
Can paying my bills late affect my credit file?
Yes, it can. For example, overdue utility or phone bills can be listed as defaults after 30 days, though the credit provider should inform you of the overdue bill before it adds a listing to your credit report.
If I receive a refusal for credit, does it affect my credit file?
Yes. Credit providers list all credit enquiries on your file, and any refusal may be a red flag to lenders. Avoid making too many applications in a short space of time, or you may have a hard time receiving approval for credit.
Under what circumstances can I obtain a free copy of your credit file?
You can check your credit report for free whenever you like with finder. If you prefer to get your credit report directly from a bureau, you can get one for free every 12 months or if a lender denies you credit( in the last 90 days).
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