Credit Reporting

A credit report is a record of a client’s credit history and financial habits. It is used by credit providers when making lending decisions. It provides a summary of activities like:

• Client credit score

• Credit enquiries

• Credit products a client holds

• Repayment history (payment defaults and positive data for payments on time)

• Defaults (Finance or non-Finance)

• Serious credit infringements (court judgments, defaults)

• Bankruptcy (current or discharged)

Changes were made in March 2014 to introduce Comprehensive Credit Reporting (CCR). Previously it was a negative only credit reporting system. Under (CCR), there is positive data included also like:

• Accounts open and close dates

• Credit limits

• Types of credit accounts

• 24 months of repayment history

Knowing your client’s credit score and history, will help you better match your clients to suitable lenders and products. Majority of Lenders use auto decisioning methodology on an application based on client’s credit score, so it is important that you know your clients credit status.

It is also a powerful tool to help Brokers verify and assess borrower expenses and have a deeper understanding of any potential early signs of financial stress.

One of the main databases that holds Credit Reports and Credit Scores in Australia is Equifax.

You can access and run a credit report on your clients using the right ‘’Account Options’’ tab.

• Within a client account, open up the account options menu bar

• Select ‘’Run Credit Report’

• Select to ‘’Run Report’’ for each applicant as required

• Follow the steps to run the report, starting with step 1 to download the consent form for signing. Upload the signed consent to the “documents” tab in Infynity.

If you subscribe to the Middle Fact Find option, you can elect to run credit reports via Equifax by default as part of your subscription requirements.

If you are completing a credit report in a different way, then you must have a signed consent from your clients before proceeding with a credit report.

You can download a Privacy Disclosure Statement & Consent from the “Document Libruary” within Infynity and have your client sign it to provide their consent before running the credit report. Upload the signed consent to the “documents” tab in Infynity.

Keep good notes about the client credit report, the notes should cover (but not limited to):

• Any red flags with early signs of financial stress

• Any paid or unpaid defaults and explanations for them

• Any late or overdue payments or arrears and explanations for them

• Any undisclosed debts – verification would be required, including guarantor loans not disclosed

• Large number or enquiries and explanations for them

Be proactive and explain any issues to the Lender within your Lender notes, don’t wait for the assessor to ask for more details or explanations.

Disclaimer: This information is current as at the time of each QRG publication. It is a general information guide only.