Changes to credit reporting in the New Year.

Do you know how your credit file is? Did you even know you had one? Most lending institutions; be it banks, or utility providers will view your credit file to assist them in making a decision whether to lend to you or open an account.  Did you know that in a recent survey conducted by Veda that around 80% of people have never even accessed their own credit report. This is alarming and seems ridiculous considering it’s free to do so.

As of March 2014 new laws will be introduced allowing more detailed information to be included on your credit file. This extra information can be backdated from December 2012.

Your credit file at present will show minor credit infringements through to serious credit breaches. The report will show how many times you have applied for credit, and if you have defaulted on any previous credit / loan accounts. That information will remain on your file up to 5 years! A serious credit infringement or court action on your file can show that information for 7 years. With the current system your loan must be overdue 60 days or more with an outstanding balance of no less than $100 to have a default placed on your credit file.

So the new laws will allow reporting entities, (Credit providers) to apply much more detailed information on you. I believe good and bad. Some of the stored information accessible may be the type of accounts you have, including the credit limit when it was opened and details of overdue accounts. The changes will soon allow a credit provider to report if you have fallen behind in single payments. This means you will not have as much grace as you had previously.

Your credit file uses a scoring system and the more enquiries you make or the more payments you miss will affect your credit score. Now missing one payment may affect you adversely.

Veda is only one reporting agency. There are two currently in Australia and soon possibly three. Dunn and Bradstreet is another agency and what can add to frustration is the fact that they do not share information!

Constantly applying for finance won’t do you any favours either. So look before you leap and make sure the deal suits you. The best advice is paying your bills on time, don’t over commit and never bury your head in the sand. 7 years is a long time.

The system is designed to give a clear picture for all lenders / credit providers when processing an application. This can also be of concern regarding how finicky some credit providers want to be. So now more than ever is a good time to be on the right side of your credit provider and to always be in contact if you think you may miss a payment.

To find more about your credit report go to mycreditfile.com.au and check out Dunn & Bradstreet so you know where you stand. Some information may not be accurate so checking out your credit file can be a good way of seeing what’s going on and if you need to report incorrect data. Web sites such as moneysmart.gov.au are a good way start trying to repair a bad credit history. It has been reported that a large amount of credit defaults are lodged by phone companies.

There have been some changes to the credit act also so all lenders must be licenced. Never enter into an agreement with someone who is not licenced.

We at SCM Beenleigh have been lending for over 12 years. We have been proud of the fact that we will give you a fair go! We will stop short of guaranteeing finance however we will usually overlook previous minor credit issues. As long as you can display to us that you can afford a loan to start with.

So want to know more? Why not get in touch with either Jess or myself and see what’s on offer or go to http://www.cars-4sale.com.au/car-finance

Steve Sharp

When Looking For A New Car Should I buy NEW or USED??

So you’re maybe thinking about a brand new car, you know, to spoil yourself.  Maybe you have done it before.  What are the advantages?  Well it’s new for starters.  Nobody has had it before you, it has a factory warranty usually 5 years or 130,000km and some of them are getting cheap now. But what are the disadvantages?

Well for starters you have to find a dealer and a salesperson. Go for a drive, pick a colour discuss your trade if you have one. This process alone usually takes 2 hours! The sales person has to do the 6 position sell (car talk for the sales process).  And don’t dare try to change the procedure. Now you want a deal, after all you were never going to pay window price, were you?  So the salesperson goes back and forth to the manager in a theatrical display that would get them a regular gig at QPAC!  Now the deal is done you can breathe a sigh of relief now all you need to do is arrange delivery and payment. If you’re lucky it will be in stock and you will only have to wait a few days. If you’re not it could be weeks or months.

 (For those that have bought new will know this) After the initial sales process you will most likely get shoe-horned into see the after-market person to sell you everything from paint protection to floor mats to weather shields and much more.  Maybe you take something to shut her up, maybe you take the paint protection and the floor mats and everything else. The next step is to meet the finance manager / business manager for that great rate you were promised, the low Interest rate they were advertising.   By the time they have finished, you have the finance, you’ve got every insurance policy imaginable and you’re still smiling. Let’s face it, they are well polished, they have this routine down pact! All is going well, the salesperson calls in to ask how things are and you will be beaming.  Then it’s time to head back to the dealership for servicing. Now you’re up for $400-$600 in servicing every time your there.  After all you don’t want to void that warranty! Not too impressed now I bet.

Try trading it in after 3 years for the latest model, or in 5-7 after you’ve paid it off!  Now’s the time you will realise how well you were tucked by that salesperson who you thought was your friend. Taking the paint protection hasn’t helped because you’ve probably taken it off through the car wash and you didn’t take it back for the annual inspections. With that and all the insurances you took out added to the financed amount now you’re looking at tearing up 10k maybe more. By the way that car you paid $19,990 (+ Dealer delivery and everything else) is now being advertised on TV and in every paper being run out for $16,990 because they have too much stock!  Makes that little bit of haggling you did seem insignificant.  And when you’re negotiating a trade price, the run out price is the new price they refer to not what you actually paid! Bear in mind the above process can happen with second hand cars too in the bigger dealerships.

Well if you can handle not being up with the Jones at the next BBQ there are some great second hand options out there. Someone else has taken the fall or mortgaged their house or sold the family jewels to get out of it. You still have to be careful, there are lemons around and dodgy dealers, but stick to a reputable dealer, get all the protection from them, and save your hard earned cash for a holiday or just keep it in the bank. You will quite often be able to trade your car in and get finance options to suit you. Stay away from the back yard guys and auctions. We have many people considering going to Auction and I’m quite often asked for my thoughts. Well I may be a little biased but are you a gambler?  You may just snag that old ladies car that was only driven to church on Sunday, but you may also get the car that the dealer couldn’t sell. Maybe it had an engine rattle or a noisy gearbox.  A little additive may just get it through the auction. That bargain you just got is now going to cost you thousands. And you didn’t even get a Roadworthy or Warranty, Bugger!

So are you still thinking new or are you now considering your options. Well why not have a little nosey around our web site to see what we have. If you don’t see what you like maybe we can source it for you. We are always contactable check us out www.cars-4sale.com.au or www.southportcarmarket.com.au

You can always call to discuss your options. We are always willing to work with you on a suitable option.

Cars 4 Sale Southport Car Market

Used Cars 4 Sale Southport Car Market

Visit our New Website www.cars-4sale.com.au for the latest bargins

---