Migrants to Australia walk a rocky road to financial success
Australia Day: Migrants to the ‘lucky country’ walk a rocky road to financial success.
21 January 2013
Australia Day is the time when thousands of new Australians are welcomed, but an advocate for accurate credit reporting says some migrants are running into trouble with Australia’s credit reporting system, and are getting banned from credit and set back on the road to financial success.
CEO of MyCRA Credit Rating Repair, Graham Doessel says migrants have unique issues with Australia’s credit system, and often the origins for unfair defaults and other credit notations come from mistakes during identity establishment.
“Some of our migrant clients are finding issues coming from incorrect names placed on their credit files - resulting in the wrong person ending up with the default or other credit listing.”
“It may be easy to track down and correctly list ‘John Smith’ but some nationalities have three or four names which can be presented in a different order in their country of origin. Some migrants can also be unsure how to present their name correctly for identity establishment in this country,” Mr Doessel says.
He says apart from identity establishment and identification issues, there is also a lack of education for migrants on the types of credit available, and what type is safest and easiest to manage.
“Migrants may choose lenders with high interest rates and terms that are not user-friendly, ultimately setting them on a path of overdue payments and debt,” he says.
Mr Doessel suggests that new Australians make a point of ensuring continuity with their name on any credit they take out and requesting changes to any bills or documentation which are incorrect.
He also says many do not know they should be checking their credit file regularly to make sure it is accurate and free from unfair or incorrect listings.
“It’s actually not just new Aussies who are kept in the dark. Many Australian-born Aussies are unaware they are responsible for checking their credit file, and that they can obtain a credit report every 12 months at no charge,” Mr Doessel says.
7 Credit Tips for New Australians
1. Do use credit – Having no credit history means there is nothing to calculate and the risk appears high to lenders. Start by borrowing something small and make repayments consistently.
2. Make repayments on time – Repay any bills by the due date to avoid incurring a late payment notation on your credit file. If a bill is greater than 60 days late you will be listed with a default. Both notations may hinder your ability to obtain credit. If you are having trouble paying a bill by the due date, contact the creditor as they may be able to work out a variation to your repayments which could prevent you from getting a negative listing on your credit rating.
3. A stable address – Lenders like to see stability and this can be reflected in your address. Once you have credit, make sure you update your address whenever you move. Defaults can happen when bills are sent to the wrong address.
4. Do your research – A competitive interest rate can save you thousands – so double check you are getting the best deal for you and your circumstances before committing.
5. Apply for credit with care – Only apply for credit you have a very good chance of being approved for. Likewise, only apply for credit you have full intention of pursuing. Every application is noted on your credit file as an enquiry, it does not stipulate whether credit was approved or not.
6. Check your credit file regularly – Check your credit file before you apply for credit. Make sure all your details are accurate.
7. Don’t leave defaults too late – If your credit file does show defaults and you feel they are incorrect, unjust or just shouldn’t be there – don’t put up with them for 5 years – it is possible to dispute a credit listing you believe is inaccurate.
“We should use Australia Day to help our fellow Aussies, and raise awareness of the problems our new migrants face, so we can all experience financial success,” he says.
People can contact MyCRA Credit Rating Repair on 1300 667 218 for help to obtain a copy of their credit report.