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Understanding Your Credit File
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How to read your credit file
Your credit file can contain the following information:
- personal details such as: name, residential address, date of birth, driver's licence number:
- credit applications and enquiries you have made during the past five years (the file records applications for credit, not actual approvals of credit.)
- notation that a credit provider with whom you have a credit account is a "current credit provider"
- overdue accounts (defaults) which may have been listed against your name
- public record information such as
- directorships and proprietorships
- bankruptcy information
- judgments and court writs
Download a sample credit file (pdf, 400kb)
Overdue accounts
Overdue Accounts may be reported as a "payment default" or a "clearout".
Payment default
A payment default is an account of $100 or more that is 60 days or more overdue. For example, if you have a telephone bill of over $100, and it was due more than 60 days ago, it could be listed on your credit file as a payment default.
Payment defaults can only be included on your credit file if the credit provider has tried to recover some or all of the overdue amount. This simply means that they have asked you, either in person (including over the phone) or in writing to your last known address, to pay the outstanding amount.
Naturally, potential credit providers may look unfavourably on applicants with a history of overdue accounts, so it's a good idea to avoid defaults getting onto your credit file. To do this, you need to ensure you pay your bills before they become overdue.
If an overdue account is listed on your credit file, the credit provider is required by law to update the listing, once you've paid the overdue amount.
A payment default stays on your credit file for five years, even when you have paid the overdue amount. The fact that an account has become overdue and then been paid becomes part of your credit history.
Clearouts
A clearout is also sometimes called a "confirmed missing debtor".
It means that, at the time of listing the person who owes the money could not be located despite attempts to contact them.
Before you can be listed as a clearout, the credit provider must make reasonable efforts to contact you, either in person (including over the phone) or in writing your last known address, to pay the outstanding amount.
If you can't be contacted, the credit provider can immediately list the debt on your file as overdue, even if it hasn't been due for 60 days or more.
Clearouts remain on file for seven years from the date they're listed, even when you have paid the overdue amount. The fact that an account has become overdue and then been paid becomes part of your credit history.
Payment Status - Current
If you have an overdue debt that you bring up to date, the credit provider must notify us that the debt is no longer overdue and can do this by updating the account's status as "current".
This means that, at the time your account was updated, your payments were up to date and the account was still open..
For example, you have a credit card account with $100 overdue, and an overall balance owing of $500. If you pay the $100, your file will show that account as "current", even though you still have credit card charges of $400.
Credit rating/credit scoring
Veda Advantage does not hold a score or credit rating on your credit file. Nor does Veda Advantage make recommendations about whether an application should be accepted or declined.
Some credit providers use scores as part of their credit risk assessment process. The score or scores may look at information on your application or your credit file or both. The score is, typically, used in conjunction with the credit providers own lending criteria..
Each credit provider, whether or not they use scoring, applies their own lending criteria when assessing applications for credit. That's why one credit provider may approve your application while another may decline it.
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