The Law Handbook 2024

Chapter 5.2: Are you in debt? 345 Credit-reporting agencies The three credit-reporting agencies most commonly used by financial institutions are Equifax (previously called Veda Advantage), Experian and Illion (previously called Dun & Bradstreet). When you apply for a loan, most financial institutions will run a ‘credit check’ on you by accessing your credit file at one of these credit- reporting agencies. If default listings are on your report, it may become harder for you to obtain credit in the future. Listings are automatically made on your credit report if: • a judgment is entered against you in a court; or • you go bankrupt. While court judgments are held on your credit file for five years, bankruptcies remain there for seven years. Queries about your credit report If you have a query about your credit report, or wish to obtain a copy of your credit report, contact Equifax, Experian or Illion: Equifax (previously called Veda Advantage) Tel: 13 83 32 Web: www.equifax.com.au/personal/ Experian Australia Tel: 1300 783 684 Email: creditreport@au.experian.com Web: www.experian.com.au Illion (previously called Dun & Bradstreet) Tel: 13 32 33 Web: www.illion.com.au/#illion-for-individuals The Australian Securities and Investments Commission ( ASIC ) is responsible for regulating consumer credit. To contact ASIC: Australian Securities and Investments Commission (ASIC) Level 7, 120 Collins Street, Melbourne Vic 3000 Tel: 1300 300 630 Web: www.asic.gov.au; www.moneysmart.gov.au Contact from the creditor to try to make you pay If you fail to pay a debt after receiving an account, a creditor will often send more formal notices or letters to encourage you to pay. Statutory notices If the debt is covered by legislation, that legislation might require the creditor to send you particular notices before it can take further action to force you to pay the debt. For example, if your debt is a loan covered by the National Credit Code ( NCC ), a creditor will almost always have to send you a default notice under section 88 of the NCC, giving you 30 days to bring the loan account up to date before the creditor can take further action (for more information about the NCC, see Chapter 5.7: Understanding credit and finance). Letter of demand – final notice If the debt is still owing after the time periods in the statutory notices (if applicable) have expired, a letter of demand may be sent to you by the creditor, their solicitors or a debt collection agency. A letter of demand usually warns that if you do not pay the debt within a certain time period (often seven days), you will be sued in a court for payment of the debt. Costs or fees on a letter of demand Letters of demand are not court documents. While debt collection agencies or solicitors may attempt to add a fee to the alleged debt, often referred to as ‘costs’, it is legally questionable as to whether they are entitled to such a fee. Therefore, unless there is evidence that the terms of the contract between you and the creditor entitle the creditor to this payment, it is recommended that you do not pay this fee. In Australian Competition and Consumer Commission v Sampson [2011] FCA 1165, a Victorian solicitor admitted engaging in misleading or deceptive conduct in breach of section 52 of the Trade Practices Act 1974 (Cth). This conduct is also likely to be considered to be a breach of the current equivalent provision, which is section 18 of the Australian Consumer Law (which is a schedule in the Competition and Consumer Act 2010 (Cth)). The conduct in that case was claiming –