That depends on who is asking, says expert
by John Dickinson
The question “is it right to help someone to restore their credit rating?” really depends on who is asking.
From a credit provider’s point of view, there are understandable concerns as the removal of a negative credit listing could be viewed as an attempt to mask an applicant’s true financial position. I understand this view if the negative credit listing in question is an accurate reflection of past events, however, what about a credit listing that is inaccurate or incorrect?
While it’s fair for a credit provider to assess an applicant’s credit worthiness based on a genuine negative credit recording, it cannot be appropriate to apply the same logic when a listing is incorrect. To suggest otherwise would be like throwing an applicant in credit prison when they haven’t committed a crime. Having said that, I do appreciate that credit providers do not have a crystal ball and they don’t have the time or ability to work out which credit listings are correct and which ones are not.
There has certainly been a lot of negative press around the credit repair industry of late. Some of this is justified, as, like many industries, not all credit repair companies operate in an honest manner. Regrettably, this has most definitely impacted the reputation of the industry. For this reason, I feel the upcoming ASIC requirement for all debt management and credit repair companies to hold an Australian Credit License, will help to legitimise the industry. Perhaps we’ll see some of the more questionable practitioners pull up stumps - we can only hope so!
Read more: Debt management companies now to be licenced
I will say that while many have been quick to question the ethical standing of credit repair, each and every one of us would cry foul if we had been the victim of a faulty or incorrect credit listing. It’s easy to judge when you’re not the one being affected. Keep in mind that a negative credit listing is only an allegation of wrongdoing. Just as a person has the right to challenge an allegation of a crime, given the credit listing in question is faulty or incorrect, they also have every right to defend themselves and insist the listing party substantiate their credit recording, and, if appropriate, remove this from their credit file.
Of course, the reality is, it can be exceedingly difficult for people to defend themselves and deal with credit providers when it comes to questioning a negative credit listing. Despite their best efforts, for many it can be an insurmountable task to challenge a credit or utility provider and can lead to many hours spent with little result. This is when an ethical credit repair company can be of great assistance.
It is a fact that some information recorded on credit files is inaccurate and can misrepresent a person’s credit worthiness. When a credit provider declines finance due to an inappropriate or incorrect credit listing everyone is affected - the economy, credit reporting agencies and, most importantly, the consumer.
With this in mind, I believe the correction of genuinely contestable credit listings is most definitely ethical and in the interests of all concerned.