The Law Handbook 2024

Chapter 5.9: Credit reporting 455 a it does not disclose information to a credit- reporting body about a person’s repayment history more frequently than once a month; b it does not disclose financial hardship infor- mation in relation to an individual’s suitability to be a guarantor (see below for information about financial hardship); c it does not disclose the contents of an assessment about the risk of an individual defaulting on mortgage credit by a mortgage credit provider; d ordinarily, for each month, the credit provider only discloses whichever of the following is applicable: i that the person’s credit repayment was not overdue for that month, or ii that the person’s credit repayment was overdue for that month; and e ordinarily, the disclosure is expressed as a code, as following: i where the person’s credit repayment is not overdue: ‘Current up to and including the grace period’, or ii where the person’s credit repayment is overdue, the age of the oldest outstanding payment is disclosed as a number: 1: 15–29 days overdue (this disclosure can only be made on day 15, as this allows for the 14-day grace period), 2: 30–59 days overdue, 3: 60–89 days overdue, 4: 90–119 days overdue, 5: 120–149 days overdue, 6: 150–179 days overdue, X: 180 and over days overdue. Financial hardship A financial hardship arrangement is an agreement between a person and their lender to adjust or defer loan obligations because something has happened that has affected the person’s ability to pay. A natural disaster is an example, but other circumstances such as illness, job loss or relationship breakdown might also lead to such an outcome. The reason a person is experiencing hardship is not recorded on the credit report. Financial hardship information in respect of credit contracts such as credit cards, home loans, personal loans and car loans can appear on a credit report. Hardship arrangements with phone, internet and utility companies and BNPL accounts will not appear on the credit report. If a financial hardship arrangement is in place, this will be shown on a credit report, and repayment history will also be shown. There are two types of indicators. ‘A’ indicates a temporary arrangement or deferral, and ‘V’ reflects a permanent change and the loan is varied. Financial hardship information is retained on a credit report for only 12 months, after which time it is removed. Default listings A credit report can show if a person has not made repayments on time for credit contracts (e.g. credit cards, home loans, and personal loans). A ‘default listing’ on a credit report shows that a payment is overdue (s 6Q PA Act; CR Code). A default listing can only be included in a credit report where: • the payment is more than 60 days overdue; • two notices have been sent, the first informing that payment is overdue and the second inform- ing that the default will be listed; • the overdue amount is greater than $150 (or a higher amount if prescribed by the Privacy Regulation). A default listing cannot be made where: • there has been a request for a financial hardship arrangement (and it is the first in the last four months); • a financial hardship arrangement is in place and being complied with; • it is less than 14 days since a request for a hardship arrangement has been refused in writing; or • a complaint is being considered by an external dispute resolution scheme, such as the Australian Financial Complaints Authority (AFCA). Default listings are removed from credit reports after five years. Accurate information Under the PA 1988, credit-reporting bodies must take reasonable steps to ensure personal information included in credit reports is accurate, up-to-date and complete, and to correct any information that is not. Amendments to the PA 1988 set clear timeframes for processing corrections to people’s credit reports. In addition, the CR Code requires that only permitted, accurate, up-to-date and complete information is included on a person’s credit report.