The contents of your credit file is incredibly important. It contains details of your credit history, borrowings, dealings with credit providers and can contain information that is used by lenders to ascertain whether or not they should approve you for a loan or service that requires you to make regular repayments.
If you have ever applied for a credit card, home loan or other form of credit (see list below) – odds are you have a credit history with a reporting agency (such as Veda or Dun & Bradstreet).
This guide will show you how to obtain a free copy of your credit report that will allow you to view your full credit history. It will also explain the importance of managing your credit file proactively, not only to fix any bad credit ratings that already exist, but to help maintain a healthy credit rating that lenders will look upon favourably.
How to do a free credit check and obtain your credit report
Your credit rating and its contents belong to you. It is personal information that details, in depth, your interactions with money, services and in particular your lending history.
While multiple credit reporting agencies may hold different pieces of information on you, the contents of your credit file is 100% your property and in turn gives you the right to request a copy, fee free, whenever you want.
In fact, by law all credit reporting agencies must offer a free version of your credit report within a reasonable period of time (often 10 working days) but are only obliged to do so once every 12 months.
How the credit reporting agencies try to trick you into paying money
These companies use a common trick; they make it hard for you to find the free version on their websites and push you towards the paid credit report instead. The paid version is the exact same report except it is sent to you faster via express post.
Tip: these credit agencies often state that they will provide a free copy of your report only if you have a) been refused credit or b) wish to verify your credit file entries for a given reason. They state they may ask you for proof of getting declined credit; the reality is however this is all just technicalities. You are allow to check your credit file once every 12 months for free, no exceptions.
Here are the two easiest ways to check your credit history for free.
Veda operate a website called MyCreditFile which offers paid and free versions of your credit report.
To order a free copy of your Veda credit history, follow these steps:
- Print off this form and fill it out (http://www.mycreditfile.com.au/dotAsset/541197.pdf)
- Scan a big legible copy of your drivers license, birth certificate or official proof of identity/age card. If possible, send a few items of ID not just one
- And obtain an original copy of a council rates notice, electricity bill, bank statement or other statement/bill that shows your name and residential address on an official piece of mail (think water bills, gas bills, phone and internet bills)
- Submit your application for your credit history report
Once you have your application filled out and ID documents ready, you can either send them via mail, fax or email. It is best to email the request for your report as it will arrive quicker.
- Veda’s mailing address is: PO Box 964 North Sydney, NSW, 2059
- Veda’s email address for reports is: firstname.lastname@example.org
Dun & Bradstreet (D&B)
Dun and Bradstreet operate a similar website called CheckYourCredit which offers a fast tracked (paid) and free credit report (standard service).
If you wish to obtain a free D&B report, simply:
- Visit their online submission form here (https://www.checkyourcredit.com.au/MyAccount/Order/StandardService)
- At the bottom half of the page, enter your full name, address, email address and begin the process of signing up for a free account
- You will need to scan (or photo using your iPhone if you are skilled enough) copies of your drivers license, passport and a range of utility bills as previously mentioned.
- They may then ask you to do your credit check online or print off the application and ID scans and mail it directly to them.
Note: D&B will ask you to sign up for an account to begin the process. This is fine but be careful they don’t then try and market to you the paid version later on.
Why order your credit history from two different providers?
Each credit rating provider may have different pieces of information on you. If you wish to get a holistic view of your credit history and see what the banks see, it is wise to check your history with multiple providers.
The reason each provider may have different results is that companies such as big telco’s and bank may use only one provider not the other when doing a credit check on you.
More information on your credit history
Why do lenders and businesses care about your credit rating?
Lenders and service providers are about your credit history for two main reasons.
Firstly they wish to know that you have repaid your previous debts and in a timely matter. They want to ensure you are not in any kind of trouble, financial or otherwise, that may hinder your ability to make timely payments. They also check for blemishes against your credit file that would indicate you have made late payments or similarly defaulted on particular debts or services to the point of receiving a bad credit rating on your record.
Secondly they wish to see what other existing debts you already have – this helps them understand just how much debt you are committed to on a regular basis and whether you have sufficient means to repay all of the debts (including the new money you might be requesting).
In basic terms; are you good for the money? Or you going to do a runner on them?
What shows up on your credit report?
Items that commonly show up on your credit file can include:
- Loans (personal and business)
- Store credit cards
- Mobile phone plans
- Credit cards
- Home loans and mortgages
The file itself will hold key information about your personal interaction with credit. This means things like the number of times you apply for a loan, credit card or mortgage (every application puts another note on your credit file). Your file will also contain information on overdue debts (if you have any) and info on whether or not you have personal, business or commercial credit assigned to your name (for instance if you have a business and a business credit card).
How long will the information stay on my credit file?
Depending on the type of information contained inside your credit report, the contents will remain for different lengths of time:
- Credit enquiries (can I borrow money?) – 5 years
- Payment defaults (overdue accounts) – 5 years
- Serious credit infringements (known as clear outs) – 7 years
- Bankruptcy information will show for 7 years
- Court judgements – 5 years
- Writs and summons – 4 years
- Your personal information such as name, DOB, licence number, address, gender and other history – forever
After the above timeframes, each facet on your report will start to disappear and be removed on or by the anniversary date of when it appeared on your credit file.
Am I able to improve my credit file?
It is an unknown science trying to improve your credit rating; in saying that though, there are definitely some things you can do to improve your credit score with individual providers and give yourself a much higher chance of looking creditworthy overall across the reporting agencies.
Some suggestions that may help you improve your credit file:
- Credit files CAN contain errors. If you believe you have spotted an error, be sure to report it immediately and ask for it to be removed.
- If you see double look ups from the same lender, ask them why and request to have excess viewings on your credit file removed.
- Pay your bills on time, always
- Don’t go applying for heaps of credit cards or loans at once; it looks desperate and lenders in the future may go on to believe you were rejected by multiple providers.
- Stay away from higher risk credit products that lenders look at less favourably; for example it is reported that lenders don’t like seeing Store Credit Cards because it appears that the customer has taken up interest free deals or lines of credit that are high risk.
- Pay any ‘overdue debts’ you find on your credit file and ask the company to list the debt as paid once you do (this will reflect as paid on your credit report).
While the above tips may not categorically improve your credit rating, it will help keep it in good stead. The trick is to proactively manage your credit file; once there is an issue, it is harder to fix than instead simply avoiding in the first place.
How regularly does my credit file get updated?
Information on your credit file is updated and removed as it expires per the time frames listed above in ‘how long does information stay on my credit file’.
The individual credit reporting agency will also update it’s scoring mechanism based on a number of factors including whether there are continuous lookups on your file, are you accumulating defaults and what not. The goal of course is to not have people peeping in your credit file every 2 minutes (the less views the better) and to have a squeaky clean listing with no defaults, late notices or overdue debts outstanding.
Do lenders and service providers need my permission to access my credit report?
Depending upon what part of your credit file a credit provider intends to look at, they will either advise you of their intention to access your file or obtain your consent to access of your file. Typically, their terms and conditions will detail under what circumstances they may access your credit file and you often will say yes without actually realising as it is hidden in the terms and conditions.