Need to Get Your Credit Back on Track?
If you’ve downloaded your free credit report only to find you have a default (or defaults), you’re not alone. While it’s never ideal to have defaults on your credit report, it’s also very common. But now that you know your credit needs repair, you can work to remove the default and get your credit back on track.
A default on your credit report indicates you have an unpaid debt. This default will lower your credit score, affecting your ability to attain future loans. Your credit score indicates your ‘creditworthiness’ to lenders; a high score is favourable, while a low score reduces your borrowing ability. If you’re hoping to get a home or car loan, or a credit card with a higher limit, you’ll first need to improve your credit score by removing defaults from your credit report.
What Is a Credit Default?
A credit default is an entry on your credit report that indicates you have an unpaid, overdue debt. A default will be listed on your credit report if you have a debt of over $150 that has been unpaid for more than 60 days.
A default will appear on your credit report as an unpaid balance coupled with any accrued interest or fees, minus additional payments you have made. The date, the company you owe money to, and what the money was for will also appear.
Defaults can appear on your credit report for various reasons, including:
- Missed loan repayments
- Unpaid utility bills
- Outstanding credit card balances
- Overdue personal loans
Once recorded, a default can remain on your credit report for up to five years, significantly impacting your ability to secure loans, credit cards, or even rental agreements in the future.
Steps to Remove Defaults from Your Credit Report
Review Your Credit Report
First, obtain your credit report from a major credit reporting agency. Carefully review the report for any defaults listed. If you’re not sure how to get a copy of your credit report, our team is happy to help. Call us on 1300 158 731 or fill in the form here.
Identify Inaccurate Defaults
Look for any defaults that you believe are inaccurate or unfair. These could include:
- Defaults listed for debts you’ve paid
- Defaults recorded without proper notice
- Defaults for amounts you dispute
- Defaults listed for debts you dispute
Before a credit provider can report a default, they first need to do their due diligence to inform you of the unpaid debt. In Australia, a credit provider must send you two separate written notices: one that is a final request for payment, and a second that warns you that the overdue payment will soon be listed with a credit reporting body. These notices must be sent to your last known address, or to the email address linked to your account (if you don’t receive mail from the credit provider). If they haven’t sent these notices, it is likely you will be able to have the default removed.
Another thing to consider when identifying inaccurate defaults is whether you recognise the default at all. In instances of identity theft, you may find debts on your credit report that you did not incur yourself. A credit repair service can help you navigate the process of removing these fraudulent credit defaults.
Gather Supporting Evidence
Collect any documents that support your case for removal. These might include:
- Payment receipts
- Correspondence with creditors
- Bank statements
Contact the Credit Provider
If you believe a default has been listed in error, your first step should be to contact the credit provider directly. Explain your situation and provide any evidence you’ve gathered. The credit provider has the power to remove the default if they agree it was listed in error.
File a Dispute with Credit Reporting Agencies
If the credit provider is unresponsive or unwilling to remove the default, you can file a dispute directly with the credit reporting agencies. Each agency has a process for investigating disputed information.
Consider Professional Assistance
If you’re finding the process challenging or time-consuming, it may be worth seeking professional help. Credit default removal services, like those offered by Credit Repair Solicitors, can streamline the complexities of credit reporting laws and provide expert credit repair strategies.
Our specialist team will negotiate directly with creditors and credit reporting agencies. If the default is unpaid when we begin the repair process, we may be able to negotiate with the creditor and reduce the debt at no extra charge — plus get the default removed, even if it was your debt.
Clear Defaults & Improve Your Credit Today
Don’t let defaults hold you back from achieving your financial goals. If you’re struggling with defaults on your credit report, we’re here to help. Contact Credit Repair Solicitors today for a free consultation and take the first step towards a healthier credit report.