Financial Rights Legal Centre
Hotline
Call the National Debt Helpline
on 1800 007 007.
Your credit report

This fact sheet is for information only. Credit reporting laws are complex and technical. It’s recommended you get legal advice about your situation.

CASE STUDY

Jin had a personal loan with a credit union. Jin was upset to receive a default notice on his loan as he was paying on time. Jin rang his credit union and discovered that a processing error meant his payments were not credited to his personal loan for three months. The credit union fixed the problem, adjusted the interest charged and apologised to Jin. Jin paid the personal loan out about a year later.

Jin then decided to get a home loan. But it was rejected because of his credit record. Jin got a copy of his credit record and found a listing from his credit union from a year and a half ago which stated he was more than 60 days in default on his now repaid personal loan. His repayment history also showed he was behind in repayments for 3 months.

WHAT IS A CREDIT REPORT?

This factsheet covers consumer (personal) credit reports. Commercial or business credit information is treated differently.

Your credit report contains some information about your dealings with credit providers. Many credit providers regularly use credit reports to decide whether to give you a loan or a service.

The report is held by credit reporting agencies.  You have to give permission for a credit provider to access your report.  Usually you sign a consent form for this when you apply for credit.

Credit providers are any business where you defer payment for more than 7 days. Examples are finance companies, buy now pay later services, telecommunication companies and utilities.

To be able to list and access your credit file the entity must be in a registered External Dispute Resolution (EDR) scheme – which means there is a free and independent complaints service you can go to if there is a problem.

WHAT INFORMATION CAN BE RECORDED ON YOUR CREDIT REPORT?

The main information includes:

  • Your personal details such as your name, address (and past 2 addresses), gender, employment and driver’s licence number;
  • Details of credit applications you have made, including joint applications;
  • Details of your current loans (more info below);
  • Repayment history information on your loans (more info below)
  • Default listings for payments over 60 days overdue (more info below);
  • “Clearout listings” (called a serious credit infringement). This is where the credit provider has tried to locate you unsuccessfully and reasonably believes that you have decided not to pay the debt. Obtaining credit fraudulently may also lead to a serious credit infringement listing;
  • Your credit score (more info below);
  • Part 9 debt agreements and bankruptcies; and
  • court judgments related to your creditworthiness.

Your credit report will give you a good idea of what debts you have, but it does not include everything. Some debts may not be listed because the credit provider does not use credit reports. Sometimes a credit listing may disappear, but the underlying debt is still active.

HOW LONG DO THE ABOVE LISTINGS BY CREDIT PROVIDERS STAY ON MY FILE?

  • Name, address etc.  No limit
  • Defaults →  5 years from when it goes on your credit report
  • Clearout / serious credit infringement   7 years from when it goes onto your report
  • Current loans   2 years from when your loan ends
  • Repayment history information →  2 years from the date the monthly payment was due and payable
  • Court judgments →  5 years from the date of judgment
  • Part IX Debt agreements  5 years from the date you entered the debt agreement, or 2 years from the date the debt agreement is terminated or declared void, or when the debt agreement is completed – whichever is the longer
  • Bankruptcy   5 years from the date you became bankrupt or 2 years from the date the bankruptcy ends, whichever is the longer

WHAT IS A CREDIT SCORE?

Lenders sometimes use your credit score (or credit rating) to decide whether to give you credit or lend you money.

Your credit score is calculated based on what’s in your credit report. For example:

  • The amount of money you’ve borrowed;
  • The number of credit applications you’ve made;
  • Whether you pay on time.

You don’t have one official score. It can be different depending on the credit reporting agency that you are requesting it from. They all have different methods of calculating credit scores and base them on different types of information. Your score will be between zero and either 1,000 or 1,200. Lenders may also have their own internal methods of scoring customers.

The score relates to a five-point scale (excellent, very good, good, average and below average). This helps a lender work out how risky it is for them to lend to you.

A higher score means the lender may consider you less risky. This could mean getting a better deal and saving money. A lower score may affect your ability to get a loan or credit, depending on the lender.

Your credit score will change over time, such as if you apply for and / or take on more debt, defaulting on your account or if you skip your monthly account payments.

YOUR RIGHTS UNDER THE PRIVACY ACT

  • You can get a copy of your personal credit report and score for free once every 3 months or when you are refused credit: see How to get a copy of your credit report, below, for details;
  • You can request corrections or a dispute noted on your file;
  • Your credit report cannot be accessed by anyone other than credit providers, potential credit providers, mortgage insurers and the credit reporting agency.  You should get advice from a tenancy law service if you are concerned about a credit report request from a real estate agent;
  • The credit provider should tell you if a loan has been refused because of your credit report;
  • The credit provider must ask for your permission to view your credit report; and give information about you to a credit reporting agency.  Consent forms are almost always contained in loan application forms.

HOW TO GET A COPY OF YOUR CREDIT REPORT

There is more than one credit reporting agency. The largest credit reporting agencies are listed below. A copy of your credit report can be obtained for free online by contacting:

Your report should be received within 10 working days of the credit reporting agency receiving your request. You may get your credit report faster by paying but this is usually not of any assistance in getting a problem resolved.

You can request that your free credit report include a free copy of your credit score. You also have a right to information about how your credit score was calculated, and which types of information about you were the most influential in calculating the score.

IMPORTANT: If you apply for a copy of your credit report, or a loan where a credit check is done, your current contact details will be updated on your credit report, and your previous creditors are likely to be notified of these updates and start contacting you again.

WHEN CAN A DEFAULT BE LISTED ON MY CREDIT REPORT?

Before a default can be listed on your credit report:

  1. 60 days must have passed since the default;
  2. A notice must be sent to you telling you the payment is overdue. This is a section 6Q notice under the Privacy Act and is often merged with a section 88 default notice under the National Credit Code (but it isn’t always);
  3. Another notice must be sent to tell you that you will be default listed.  This is a s21D(3) notice under the Privacy Act;
  4. You have 14 days from the second notice to fix the default before a listing can be made.  The listing cannot be made more than 3 months after the notice.

If you pay a default after it is correctly listed, you can ask for the listing to be updated as “paid”.  The default listing does not disappear just because you have paid it.

DETAILS OF CURRENT LOANS AND REPAYMENT HISTORY 

Since March 2014 your credit report has contained information about your current loans and whether you have made any late payments (repayment history information) including:

  1. Type of account;
  2. Account open and close dates;
  3. Credit limit (NOT outstanding debt);
  4. Terms and conditions eg. loan term, type of security, interest only or principal and interest;
  5. Repayment history information.

Not all lenders record all of the above information on your credit report. Large banks are required to record all five types of information listed above, but smaller lenders like payday lenders don’t have to. All credit providers have the option to start providing more comprehensive information about your loans, as long as they have notified you.

This information also is not listed for buy now pay later, telecommunication or energy debts even though those types of services can list defaults.

REPAYMENT HISTORY INFORMATION. WHAT IS IT? HOW DO I MANAGE IT?

Repayment History Information (RHI) is information about whether you have repaid credit on time. RHI can only be collected on credit regulated under the National Consumer Credit Protection Act 2009 (the “National Credit Act”), not utilities and other debts.

If you are paying on time you will get a 0 (meaning zero months behind). Some credit reporting agencies put a tick mark instead of a zero. If you are behind in your repayments you will get a number from 1 to 7 indicating how many months you are behind in your repayments. If you are more than 7 months behind there will be an X.

You have a grace period of 14 days from the payment due date to make the payment, before any late payment (including part payment) is recorded on your credit report. The lateness of the payment is updated every 29 days. The 1 to 7 scale indicates how many months the payments have been overdue.

IMPORTANT: RHI is different to a default listing. You do not get any notice when a RHI listing is made – you need to check your credit report.

FINANCIAL HARDSHIP (UNDER THE NATIONAL CREDIT ACT) AND YOUR CREDIT REPORT

1. Repayment History Information

New laws passed in 2021 set out how lenders record your RHI when you apply for a hardship arrangement (such as reducing or postponing your payments).  These changes go into effect in July 2022.

What happens after 1 July 2022

Once you have indicated to your lender that you are in hardship your lenders should classify any kind of agreement, arrangement or understanding regarding your payments going forward, as a hardship arrangement and begin reporting your RHI as zero as long as you are sticking to that arrangement.

These changes are new, and it is still important you clarify with your lender what will happen to your credit report when you make an arrangement, and make a complaint if you are unsatisfied with the response. You should also get a copy of your credit report a couple of months later to check your repayment history information.

If you aren’t able to keep to your repayment arrangement, you should let your lender know and come to a different arrangement before you fall behind. You should ask how this new arrangement will be reflected on your credit report as well.

What happens between now and 1 July 2022?

You should ask your lender directly and check your credit report.

Some lenders may withhold RHI while you are in a hardship arrangement. An “R” on your credit report means RHI information is “not reported”.

Withheld RHI or “R’s” should not harm your credit score, but it will indicate to other lenders that you have made some kind of arrangement with your current credit provider. If you are applying for new credit any new lenders may ask you questions about your arrangement and whether you are in hardship.

2. Default listing

A default listing cannot be listed if a request for hardship has been made (and it is the first request in the last 4 months). A default cannot be listed until 14 days after the hardship variation has been refused in writing. A default cannot be listed while you are in an external dispute resolution scheme: see our Dispute resolution fact sheet.

What happens when my hardship arrangement ends?

When your hardship arrangement is finished your RHI will go back to being reported against your normal monthly payments.

If you are still catching up on missed payments and have built up some arrears (money that you owe) then your RHI may be negative.

Sometimes you can negotiate for any arrears to be added onto the end of your loan (capitalised) and for the loan term to be extended, so you can return to normal repayments at the end of your hardship period.

You should speak to your lender about how to deal with the arrears, and how that will be reflected in your RHI.

WHAT ALL OF THIS MEANS:

  • Request hardship (in writing if possible) as early as possible;
  • Make an affordable repayment arrangement as quickly as you can and stick to it;
  • Ask your lender how payments will be recorded on your credit report during your arrangement and after it is finished;
  • Lodge in a dispute resolution scheme within 14 days if your request for hardship is refused. You should also lodge a dispute if the lender intends to report you as late on your repayments (or you find out later that they have done so).

Note: Getting a hardship variation will not fix any late payments that have already been reported to the credit reporting agency before you contacted your lender about hardship. These late payments will remain on your credit report for 2 years from the time of listing.

WHAT DO I DO IF THERE IS A PROBLEM WITH MY CREDIT REPORT?

STEP 1

Get a copy of your credit report. If the information in your credit report is wrong or misleading you can make a complaint.

STEP 2

Call or write to the credit provider and raise your dispute. You need to give reasons as to why the listing is misleading or wrong. The credit provider has 30 days to respond.

Some examples:

  1. You do not owe the debt listed. For example, someone used your stolen ID and obtained a loan. Write giving details of what happened and report it to the police. Then send a copy of the police report to the credit provider;
  2. The loan was not overdue for 60 days or you did not get any notice. For example, you missed one payment on your loan and caught up and you were never 60 days in default. You could send copies of your account statements as evidence;
  3. The amount of the debt listed is incorrect.  Keep in mind that debts can grow with interest and fees;
  4. The debt is very old and statute barred: see our Recovery of old debts factsheet (NSW only);
  5. The same overdue account has been default listed twice;
  6. You were listed as a “clearout” and you were easily contactable and are now in contact with the credit provider. For example, you separated from your partner in a joint loan and forgot to notify the lender of your new address. You were always listed in the phone book or your mobile number never changed. In this case you would argue that it was unreasonable to list you as a “clearout”;
  7. Your RHI shows several missed payments but you have been paying on time every month.

STEP 3

If the credit provider:

  1. Fails to respond in 30 days; or
  2. Refuses to amend or remove your disputed listing.

The next step would be to raise the dispute in an external dispute resolution scheme (EDR).

The relevant dispute resolution schemes are:

Financial services eg. Loans, credit cards, rental contracts for goods

Australian Financial Complaints Authority (AFCA)
Ph: 1800 931 678

Telecommunications

Telecommunications Industry Ombudsman (TIO)
Ph: 1800 062 058

Energy

 Energy and Water Ombudsman NSW (EWON)
Ph: 1800 246 545

Insist on a reply in writing to your dispute.

Alternatively you also have the option of making a complaint to the Australian Information Commissioner.

Visit oaic.gov.au or phone 1300 363 992.

Time limits apply to making a complaint to each of the schemes above – for instance, you only have 12 months from the date you became aware of the inaccurate listing to file your complaint with the Australian Information Commissioner.

Get advice if you are not sure where to complain to.

NEED MORE HELP?

See our Getting help factsheet for a list of additional resources.

Last Updated: August 2021.