Results of a recent survey by Dun & Bradstreet, confirm that demand for credit in Australia has continued to drop, and nearly a third of households are expecting to experience a degree of difficulty meeting their repayment obligations.
The Dun & Bradstreet Consumer Credit Expectations survey shows fewer Australians intend to apply for credit in the September quarter than expected to in the June quarter. Nineteen per cent of respondents said they would apply for credit in the September quarter, down from the 27% who indicated they would do so in the June quarter.
While the number of survey respondents who believe that they will struggle to meet their repayments has declined slightly, 30% still indicate they will face difficulty fulfulling their credit obligations. Nearly half the surveys respondents said any RBA interest rate rise would have a serious impact on their family budgets.
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Does it hurt my credit score if I settle my account?
Yes.
The term “settled” means the lender has agreed to accept a final repayment amount that is less than full repayment of the debt. The account will be shown in your credit report with a status of “settled,” indicating the debt was not paid in full, as originally agreed.
Anytime you do not repay an account in full or as agreed in the original contract it will have a negative effect on credit scores.
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22 Nov
Posted by Dustin Ramirez as Credit Cards Guide
One thing is for certain, bankruptcy is a brutal beast when it comes to your credit file. But getting a car loan after bankruptcy is one of the best ways to begin the rebuilding process to regain your borrowing reputation and qualify for other loans. In fact, once your bankruptcy has been discharged, you can pretty much apply almost immediately for a car loan. Let us take a look at what you can do to get the best rates on your post bankruptcy car loan.
Checking Your Credit Report And Score
Before you run to the car dealership, you should always check your credit report to make certain that all of your accounts are noted as discharged in bankruptcy. Oftentimes, your credit report following bankruptcy will still show open accounts when they should be noted as closed and discharged, which does harm to your credit rating. And since different car dealerships use different credit bureaus when they inquire about your credit, be certain that you contact all three major credit reporting bureaus to determine the accuracy of your credit file (Experian, Trans Union, and Equifax).
If your bankruptcy and accounts are not noted accurately, contact the bureau in question immediately to request that they update your record. Read more…
07 Nov
Posted by Dustin Ramirez as Credit Cards Guide
If you lose your job, you may consider going back to school to improve your skills or perhaps to train for a new career. However, you may wonder whether doing so would place your unemployment insurance benefits in jeopardy. Depending on which state in which you live, you may be allowed to collect benefits and attend classes. You may even qualify for tuition grants to ease the financial burden of returning to school.
A primary requirement for displaced workers to obtain and retain eligibility to receive unemployment insurance payments is that they are “available for work.” This means that if you become unemployed and apply for unemployment insurance benefits, you must demonstrate that you would be able to report for work during the hours customary for the type of job you are seeking.
Changes to lending rules which followed the GFC and the introduction of the National Credit Code , in conjunction with Tax Office crackdowns on small businesses have caused a 6 per cent increase in the number of Australian companies going under.
Australian Securities and Investments Commission insolvency figures, released yesterday show 9829 companies entered external administration in the 2010-11 financial year, the highest figure since the peak of 10,005 during the global financial crisis.
Businesses who are experiencing tough retail conditions are not finding an understanding ear with the banks, who are making it far more difficult for borrowers to qualify for loans even where the borrower has plenty of equity in their home.
The leader of ASICs insolvency team, Adrian Brown, said banks in an effort to prevent client bankruptcies have gone some way to meet stable clients, in some cases allowing facilities to be rolled over without the provision of further financials.
In addition to borrowing from banks, Australian companies are exposed to US credit conditions through their heavy reliance on North Americas private placement market, the source of a third of the Australian corporate sector debt raised last year.
About $6 billion of the $21 billion in Australian corporate debt that needs to be refinanced next year is sourced from the US private placement market, with $7.2 billion coming from banks, according to research released by Moodys in March.
While large corporates are able to issue bonds and borrow offshore, the smaller companies that make up the bulk of insolvencies depend on bank finance.