Introduction Of Positive Credit Reporting Systems Coming To Australia In 2011
Posted January 20th, 2010
The Australian credit card application and credit card approval process will become a lot easier from next year onwards when we get to enjoy positive credit reporting. This means that good bill payers get to enjoy the rewards for paying on-time.
Currently if you apply for a loan, file bankruptcy and have outstanding defaults of 90 days or longer all this data is marked down on your credit file. This of course is not good because it tells lenders you are not to be trusted with their credit.
Joel Palmer of Palmer Portfolios says every time you apply for finance or default on a payment, the details are recorded in a database that is accessed by all financial institutions.
He said: “If you apply for 27 credit cards in two months, or miss a few too many payments, you’ll end up with a black mark against your name and find it next to impossible to obtain new finance.”
“Positive credit reporting forces banks and credit card companies to report our good qualities, not just the bad.
“Let’s say you’ve had a home loan for 15 years, never missed a payment, and always had your credit card under control. If Australia had a positive credit reporting system, you would then show up on the database as an extremely good credit risk.”
“The major benefit for you is that banks will then be falling over themselves to lend you money.”
Dun & Bradstreet’s chief executive, Christine Christian, says positive credit reporting is used in the US and other developed countries. She says: “People think paying an overdue debt will remove the listing from their credit report: This is untrue. Negative records such as collection accounts, late payments and bankruptcies stay on your credit report for up to seven years, even if you pay them off.”
If you currently don’t understand how the system works you should apply for your free credit report copy through a credit reporting bureau. Knowing where you stand with lenders will serve you better in regards to making successful loan applications.
Source: News.com.au
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Comparison of our Top Credit Card Offers
| Interest Rate (p.a.) | Balance Transfer Rate (p.a.) | Annual Fee | Cash Advance Rate (p.a.) | |||
|---|---|---|---|---|---|---|
Bankwest Breeze MasterCard | A low interest rate on everyday purchases with a low balance transfer offer | 0% for 6 months (reverts to 10.99% ) | 4.99% for 9 months | $49 | 21.99% |   |
Citibank Clear Platinum Card | A low interest rate offer on balance transfers and purchases | 11.99% | 0% for 12 months with 3% handling fee | $99 | 21.74% | |
St.George Vertigo | An introductory offer on balance transfer and a low annual fee | 13.24% | 0.99% for 6 months | $55 | 21.49% | |
Virgin Flyer Credit Card | Earn 1 velocity point per $1 spent, plus an introductory offer on balance transfers | 20.99% | 1.9% for 12 months | $50 (for first year thereafter $99) | 20.99% | |
Westpac 55 Day Credit Card | No annul fee for the first year with a low rate on balance transfers and purchases | 0% for 5 months (reverts to 19.59% ) | 3.99% for 6 months | $0 annual fee for the first year ($30 thereafter) | 21.49% | |
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