Australian credit repair companies can help you improve your borrowing ability by correcting errors in your credit file.
If you have an incorrect listing on your credit file, credit repair companies in Australia may be able to help repair your credit reputation and improve your chances of getting approved for credit in the future. These companies can initiate an investigation into questionable listings in your report. If your credit rating has been damaged by fraud or erroneous listings from credit providers, credit repair companies can investigate the listings and may be able to remove them. Find out how the process works and if it might be able to work for you in our guide.
What is credit repair?
Credit repair is the process of correcting mistakes in a credit file with the aim of improving your credit score. Your credit file contains your credit history, including certain types of current accounts and whether you have missed any payments, or had defaults, court actions, credit enquiries, bankruptcy or insolvency notes against you.
Any infringements caused by fraud may also appear on your credit file, denying you the opportunity to get credit from lenders. Credit repair is performed by various agencies who are experts in investigating listings in your credit file and removing any defaults, court actions, or repayment history indicators (RHI) listed in error.
Paying an outstanding debt associated with an adverse listings on your credit file will not in itself remove the listing automatically. Listings are removed if the credit provider has not adhered to the laws regulating credit reporting in Australia. A credit repair agency can investigate and argue for the removal of any erroneous listings or listings made in violation of credit laws.
How does credit repair work?
Credit repair works by the company removing negotiable listings on your credit report. The following process usually applies:
- Initial consultation. You may be offered an initial consultation to explain the credit repair process. This should be complementary and it's to ascertain whether the process will meet your needs.
- Check your credit file. Following this your credit file is checked and the first fee is charged. This stage is to see if there are incorrect listings that can be removed and if there are actionable things that can be done to improve your score.
- Formally apply for credit repair. If you want to move forward you will need to formally apply for credit repair. You'll need to list the defaults or incorrect listings you want investigated and removed and you will need to pay a fee for each.
- Contacting creditors. The credit repair company, if it accepts your application, will then contact creditors to determine which defaults can be removed from your file. Some credit repair companies may negotiate a payment plan with your creditors if you still have an amount owing.
- Listings are removed. If successful, listings are removed from your file. You will pay a fee for each successfully removed listing.
Ways you can compare credit repair companies
- Transparency of fees. Credit repair agencies can sometimes charge large amounts to review and make corrections to your credit report. Ensure that the agency you choose charges reasonable fees to fix problems with your credit file.
- Reputability. There are many disreputable credit repair agencies that promise to repair your credit history, but are really just out to take your money. It’s important to examine the reputation of a credit repair agency before enlisting their services.
- Customer reviews. Listening to what other customers say about a credit repair company can give you a better picture of what their services are like. Delays in making corrections, charging outrageous fees or failing to improve credit reports will definitely lead to negative online reviews, so be sure to go for an agency with a good track record and success in repairing credit reports.
How do I get a copy of my credit file?
Getting a copy of your credit file is the first step to the credit repair process. The law dictates that all lenders have the right to access credit files from credit reporting agencies whenever they wish. It’s important to check your credit file regularly so as to ensure your credit score remains healthy – and you're entitled to a free copy every year.
Ensuring that your credit file is updated and free of errors can be your ticket to successful credit applications, so you should try and order a copy from top credit reporting agencies each year. Most reporting agencies will dispatch a free copy of your credit report to you within 10 working days, or you can pay a fee to get it dispatched to you within a day or two.
Why is it important to check my credit file?
- To check for incorrect personal details. Information about your address, employment history, names and current employers needs to be accurate so that you are better protected from identity theft and to ensure your personal information is in order when applying for credit.
- To ensure no listings are incorrect. Mistakes in your credit file can be very costly, denying you access to credit for up to seven years in cases of serious credit infringements. Checking for erroneous defaults, court actions and repayment history indicators (RHI) may be a result of errors from lenders or identity theft is necessary to keeping a clean credit file.
- To initiate credit repairs. Once you pinpoint mistakes or disputed listings in your credit file, you can then hire a credit repair agency to investigate them and look for grounds for their removal.
Frequently asked questions
How much does credit repair cost?
The specific fees will differ between credit repair agencies, but you are likely to pay between $500 and $1,500 dollars in total to have a listing removed from your file. You normally pay per listing removed.
How can a credit repair agency help?
Trying to correct errors in your credit file on your own can be a daunting task, as contacting credit providers or providing proof of erroneous listings can be challenging. A credit repair company will have professionals who understand the legislation and so be able to point out regulation infringements use their relationships with lenders to push for faster corrections.