Chat with us, powered by LiveChatWill the “CCR” be singing for you?

Will the “CCR” be singing for you?

Mention the term “CCR” to most people and chances are that they will either look at you blankly, or try to figure out whether you are talking about their Child Care Rebate, or the iconic 1960’s rock band, Creedence Clearwater Revival. However, there is a new CCR in the wind, and it is worth knowing about as it is set to have an impact on most Australians.

It turns out that the current credit rating system for borrowers is set to be overhauled with the new system being based around Comprehensive Credit Reporting, (CCR).

Under the current system, there is only a limited amount of information available to lenders, with most details of a borrower’s credit record being protected by the Privacy Act. In fact, a lender today can only access information regarding credit enquiries and major ‘negative’ credit events such as defaults or bankruptcies.

However, once the CCR is introduced over the next month, lenders will have access to information on when an account was opened or closed, credit limits, types of credit accounts and your repayment history.

In talking to a few mortgage brokers and others who work in this field, the consensus seems to be that this new system will be an added reason to keep all your bills paid on time. Apparently, any payment of a bill of more than $150 that is more than 60 days late will qualify as a “default” and will appear on your credit file.

On the positive side, the consensus also seems to be that those with a good credit record will benefit from the new system as there will be more information available to lenders that will reflect your good record.

So, as Creedence Clearwater would tell us, when you’re applying for a loan you can now be pretty sure that the Bank will have done more than simply “Heard it on the grapevine”!