Consumer Affairs Victoria is urging consumers to choose free debt-management advice and credit-repair services over other, high-cost options.
There are companies that claim to be able to fix credit reports and offer debt management services, but they charge high fees, are not always able to fix people’s debt issues and can leave consumers worse off.
If you are experiencing debt problems or have concerns about your credit rating, you can access free credit repair and debt advice services.
Director of Consumer Affairs Victoria Simon Cohen said consumers may not realise that free services exist to help them with debt problems or to fix inaccurately recorded credit reports.
“It’s important for consumers to understand their options when it comes to managing debt and their credit rating, as well as understanding what can and can’t be fixed,” Mr Cohen said.
"Incorrect entries on credit reports can unfairly reduce a borrower's ability to access finance, and that is something you can have removed.
"Rather than paying a credit repair company or debt management firm, consumers can contact free financial counsellors and community legal centres for help or advice."
Unless a credit listing is incorrect it cannot be removed, but if you think you have had a credit default wrongly listed against you, you can approach the credit reporting agency directly to correct it, or ask the creditor to remove it.
If you are not satisfied with their response, you can contact the Financial Ombudsman Service on 1800 367 287 or the Credit and Investments Ombudsman on 1800 138 422 to make a complaint.
The National Debt Helpline (1800 007 007) can help you with debt problems.
For more information and guidance on credit repair, free financial counselling services, and managing debt, visit the Australian Security and Investment Commission’s MoneySmart website.