The information contained in a credit file can be used in determining a person's credit-worthiness.
Therefore, it is important for consumers (particularly those who are borrowing) to regularly review their credit file.
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To help manage your credit file follow these six guidelines:
- Understand what a credit file is
- Check your credit file
- What to do if you are declined credit
- What to do if you have an overdue account
- Maintain your credit-worthiness
- Dealing with identity fraud
Guideline Number 1 - What is a credit file
A credit file is simply a report that records information (e.g. credit, identity and publicly available) that is of relevance for credit assessment purposes including:
- Who you have applied to for credit (e.g. banks, utilities such as gas, electricity, telephones, finance companies)
- The amount of credit you applied for
- From what body or institution
- The type/purpose of credit sought (e.g. overdraft, interest free, home loan, credit card).
It may also include information necessary to identify you as well as information of relevance for credit assessment purposes, such as
- Personal details (name, address, sex, date of birth)
- Payment defaults (Overdue accounts)
- Collection data or collection agency defaults
- Insolvency details
- Court judgements
- Details of directorships.
Access to your credit file can only take place with your authorisation in most instances. However, your authority may not be required in all cases; such as by certain public sector agencies and those involved in court proceedings.
Veda records information on credit files under the strict regulations of the Credit Reporting Privacy Code.
Click here to download the application form.
Guideline Number 2 - How to check your credit file
The information contained in the file is easy to read. Importantly, the information is one of the factors that impacts on your credit-worthiness.
Banks, retailers, credit providers and subscribers to a credit reporter use the data, along with the information you provide to them, to determine whether to lend you money or not.
This makes it crucial for consumers to keep reviewing their credit file.
Use Veda's Credit Alert to monitor your credit file so that you may receive emails when an enquiry is made to your personal credit file.
Another reason to monitor your credit file is to check that someone is not using your identity to fraudulently borrow money.
Click here to download the application form.
Guideline Number 3 - What if you are declined credit
The decision to decline your application for credit is made by the credit provider (subscriber) not Veda. The first step in identifying why you were refused credit is to look at a copy of your credit file. You may discover:
- You have overdue accounts or collections (defaults) you had forgotten about
- The information on your credit file is incorrect
- Someone has been using your identity to obtain credit fraudulently and has defaulted on the payments.
It is also important to understand that a credit provider may decline an application for credit even if overdue accounts, court judgments or bankruptcy information on a file show that they have been paid in full or settled.
Credit providers each have their own lending criteria. They will attach varying degrees of importance to the information provided in the credit file and that which they obtain from you, depending on the amount of risk they wish to take when deciding whether or not to approve credit.
To request a correction or investigation into the identity content of your credit file
This refers to the "Subject Details" section of your credit file.
Step 1
Prepare your request in writing - you do not need to fill in a form but your written request must provide:
- Your full name and address
- The Inquiry Number that appears on the top of your credit file
- Full details of the corrections or investigation you are requesting
- Any relevant information and documentation to support your request.
Step 2
Forward the request details from Step 1 to:
Public Access, Information Services & Solutions (NZ)
Veda Advantage (NZ) Limited
Private Bag 92156
Victoria Street
Auckland
To request a correction or investigation into entries recorded on your credit file by a subscriber or collection agent
These entries may appear in the following sections of your credit file:
- Previous inquiry
- Payment defaults
- Collection agency defaults
- Collection data.
Step 1
If: You believe an entry made by a subscriber or collection agent is incorrect, first contact the subscriber or collection agent named on that entry for further information about the accuracy of that entry.
If: You are not satisfied with the response of the subscriber or collection agent and feel your issue is legitimate, make your request for correction or investigation in writing to Veda. (Refer to steps on how to request a correction or investigation into an entry of public record information)
Step 2
Prepare your written request to Veda. In addition to these steps:
- Request that Veda investigate your issue for you
- Write a short explanation of the issue you have in relation to any detail in your credit file
- Please include copies of any relevant documentation that may assist us and the details of any investigation or other steps you may have already carried out in relation to the issue.
If: You believe that information held on your credit file has been caused by another individual fraudulently using your identity details,
- Report the matter to the police.
- Report the matter to the fraud department of each of the subscribers involved.
The subscribers can conduct their own investigations and notify Veda of the outcome. We can then remove any fraudulent information from your credit file.
Important: You must liaise with the appropriate subscribers directly or through your solicitor. A subscriber may hold you responsible for any bad debt incurred if they are not made aware of all relevant circumstances.
To request a correction or investigation into an entry of public record information (e.g. bankruptcy, public notice, court judgment or directorship)
Step 1
Verify the information with the source.
Step 2
Provide satisfactory documentation of the verified information to Veda, for example, a receipt of payment when a debt has been settled after a court judgment.
Step 3
Upon receipt of the documentation Veda will amend the entry accordingly.
Click here to download the application form.
Guideline Number 4 - What to do if you have an overdue account (Default or collection) on your file
- Where an overdue account showing on your file has been paid but not updated, call the subscriber or collection agent named on that entry and request they contact Veda to make the correction. Your credit file will be updated within five days of the credit provider notifying us that the account is paid
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Where an overdue account is showing that is not yours call the the subscriber or collection agent named on that entry and give them the applicable reference number so they can investigate. If justified, the subscriber will then inform Veda and the incorrect data will be removed.
Click here to download the application form.
Guideline Number 5 - Maintaining your credit worthiness
The following steps are recommended:
- Pay your bills on time
- Call your credit provider(s) in a timely manner and alert them if there is a problem meeting your commitments
- Review your credit file to make sure there are no errors in the information and/or discover any overdue accounts that have been forgotten about
- Monitor your credit file to ensure someone is not fraudulently using your identity (a growing problem worldwide)
- A "no" to a credit application, or the supply of goods and services where payment is deferred, does not necessarily mean your credit file is flawed. Credit providers each have their own lending criteria, so seek an explanation
- Remember that the details on overdue accounts or collections, even when paid, remain on your file for five years from the date of default, as part of your credit history
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An overdue account is usually an account where payment has been overdue for a minimum of 30 days.
Guideline Number 6 - How to deal with identity fraud
One of the most common forms of credit fraud is committed by 'stealing' the identity of another individual. Someone obtains your identity details and uses them to obtain credit for themselves, leaving you with the potential liability for this debt, a damaged credit reputation and the inconvenience of amending your credit file.
The upshot is that the individual is left with a potential liability for the debt, a damaged credit reputation and the inconvenience of amending a corrupted credit file.
Protection is the best deterrent:
- Know what is on your credit file
- Regularly monitor your credit file
- Sign all new credit cards as soon as they are received
- Store cards and personal ID items in a secure place
- Shred any paperwork that contains your personal details or account details before throwing away
- Contact your financial institution immediately if your cards or account details are lost or stolen
- Keep your Personal Identification Number(s) confidential and separate from your card
- Don't disclose your Personal Identification Number(s) to anyone
- Contact the police, then your credit provider(s) if you discover information on your credit file has been caused by another individual fraudulently using your identity details. Keep notes of all your conversations with these bodies, including names, dates and contact numbers.