Changes to debt repayment reporting that will affect your credit file in 2018
In 2018, new legislation will come into place about the information a lender is required to provide regarding your credit facilities and your ongoing debt repayments. This detailed information will be recorded on your credit file and can greatly affect your finances in the future.
Previously, your credit file didn’t have information on monthly repayment history, credit limits or account open and close dates, which means the information on your credit file was relatively limited. The Australian Government has proposed a change that mandates Comprehensive Credit Reporting (CCR) from 1 July 2018. This new legislation mandates the reporting of detailed positive and negative repayment history on your credit file. This means Lenders will report 24 months of repayment history, account open & close dates and credit limits for all open consumer credit accounts, which includes home loans, credit cards and personal loans.
This is good news for those people who repay all your debts on time. Next time you apply for finance, the lender will see that you make your repayments on time every month and this will help with your finance application.
The opposite applies for those people who may occasionally make a late payment or miss a payment. The next time you apply for finance, the lender can see the status of every repayment for the past 24 months. This includes payments that were made on time, late or missed and will impact negatively on your chances of getting new finance approved.
Some major lenders such Westpac, St George, National Australia Bank and GE Finance have already started monthly repayment reporting and the rest will follow in the coming months. If you haven’t already done so, now is the time to set up automated repayments on all your debts to ensure they are paid on time and you don’t have any issues on your credit file going forward.