Welcome to Credit Simple. If you’re reading this blog, chances are you’ve found your way here after asking a search engine if our business is legitimate (such as here on Geekzone and here on Reddit). So we thought we’d give you the low-down on myths and truths about our business, credit scores, and your rights and privacy.

Pffffft. Everyone uses Veda! Nobody uses Credit Simple.

There are three credit reporting agencies in New Zealand: illion (Credit Simple’s parent company), Equifax (formerly Veda), and Centrix. Each company holds slightly different sets of information. Credit scores are calculated using sophisticated statistical models, and are based on information that is held by the credit reporting agency. Different credit reporting agencies may hold information from different credit providers, and each agency will have developed its own scoring models. Your score from each agency won’t necessarily be the same. Our parent company illion holds a significant amount of unique data that other credit reporters don’t hold (and therefore use in their credit scores), including telco and utility account and payment information. When a company does a credit check on you, they may use one, two, or all of the companies to do so. We recommend that even if you get your score through Credit Simple, you should still check your credit file with each company (you can do this free, but you may have to pay if you want instant results).

I think your business is a scam and you’re ‘phishing’, or conducting identity theft

None of the above. Credit Simple is owned by illion, a data analytics company, and we adhere to all relevant legislation. Credit Simple is not a scam and never engages in ‘phishing’. As a credit score business, we take your privacy extremely seriously and we’re also big on consumer rights. Our parent company is a credit reporting agency, and credit reporting is an area that’s tightly regulated, and the industry has to toe the line at all times. Your information is kept secure and we don’t sell your information to anyone. Only you can see your credit report and if a credit provider wants to check your credit, they have to advise you that they intend to do so, and you need to agree to the credit provider doing so. We have more information about rights and privacy on our blog here and you can read our privacy policy here.

I can’t believe you’re using my star sign to calculate my credit score!

That’s a common myth. Your star sign isn’t used to calculate your credit score at all. When you’re in the Credit Simple dashboard, you’ll see stats about how you compare by age, gender, star sign and so on. This is simply a comparison tool for your interest – a novel way of looking at how you measure up to other people like you.

If I check my credit score with you, will it lower my score every time I look?

Not at all. You can check your own score as often as you like and it will never affect your score. A credit provider checking your credit file is called an ‘enquiry’ but if you check your credit, it’s called an ‘access’ and that doesn’t affect it. However, if you apply for lots of credit with a credit provider (e.g. a credit card or loan) within a short space of time, your credit score can go down for a while, as it makes you look ‘desperate for credit’ to credit providers. It’s best to shop around for credit first and figure out what suits you best before applying for anything.

The credit score you gave me is different to the one I got from another service

Yep, that can happen. In fact, it’s highly unlikely that you’ll have the exact same credit score from any two providers. Each credit reporting agency has its own way of calculating credit scores, and each company also has a slightly different set of data. To add to that, our credit score range is 0-1,000, whereas other companies have ranges that run higher than 1,000. In an ideal world, consumers would be able to see a credit score that pulls on all possible/available credit scores, but as yet, this service doesn’t exist.

I own a mortgage-free property and have cash in the bank, but my score is really low

Credit scores are calculated based on credit you’ve accessed, rather than assets you own, so your mortgage-free house or your savings account aren’t put into the calculation. Credit reporting agencies simply don’t have access to information about your assets. While this information would be beneficial when applying for credit, it’s not information held by a credit reporting agency.

Has the credit reporting system changed?

Credit reporting has recently changed from a ‘negative’ system (where you got penalised if you did something naughty, but otherwise were treated much like the next person) to a ‘comprehensive’ system (where your ‘positive’ payment information is now being put into your credit score calculation). We know from our analysis that on average, a Credit Simple user with positive information on their file will have a score that’s around 100 points higher than one without positive information.

Someone else’s information is on my credit file!

In a very small number of cases, there can be mistakes on your credit file. We’ve built in a way for people to question something if they think it’s incorrect (you can see this within the dashboard – look for the button that says ‘question this’). To date we’ve had less than 1% of Credit Simple users query something. If you need help getting something sorted out, email us on creditsimplesupport@illion.co.nz or call us on 0800 005 088.

Still got questions? Have a look at our Learn section on the website and check out our blog. Talk to us. Email us on creditsimplesupport@illion.co.nz or call us on 0800 005 088.

The post Is Credit Simple legitimate and reliable? Our response to questions on Reddit, Geekzone and elsewhere online appeared first on Credit Simple NZ.

There’s nothing like owning a ferocious guard dog for dealing with debt collectors. Chomp, chomp, chomp. There goes the arm of that dastardly fella.

No, no, no. Stop there. Kiwis consider debt collectors to be a lower form of life. Regardless, setting the dog on them isn’t going to solve your problems – it’ll just make them worse. Debt collectors don’t even taste that nice.

We know it’s common behaviour to stick your head in the sand when you can’t (or forget to) pay a bill. But leaving all those envelopes unopened or sneaking around to avoid the debt collector isn’t going to make your money problems go away. Leaving it just makes the debt more expensive because you may have to pay the collection fees.

The only way for things to get better is to take action. That can include:

Knowing your rights

Debt collectors can’t just break your door down or take your car because they feel like it. We’re not living in the 19th century where you could be sent to the poor house. By law debt collectors can’t use physical force, coercion, or unreasonably harass your family. They can’t mislead or deceive you or take advantage of vulnerability such as a disability. They certainly can’t tell your family, friends, or employer about your debt without your consent. And they can’t charge unreasonable debt collection fees. If they do any of this nasty stuff you’ve got the right to complain. That can be to the Office of the Privacy Commissioner if the debt collector has broken the privacy laws or the courts if the Credit Contracts and Consumer Finance Act or the Fair Trading Act is breached by, for example, claiming unreasonable debt collection fees or misleading you into believing that you are required to pay fees when you are not. For more information visit the government’s Consumer Protection website.

Check everything

The Commerce Commission occasionally gets complaints about debt collectors, such as misrepresentations about the right to collect the debt as well as incorrect debt amounts. So make sure you read all the paperwork, including your original contract, and check your bank statements to see if you have made payments. If anything seems amiss go to your local Citizens Advice Bureau or Community Law Centre for advice. (Not the Commerce Commission, as it doesn’t give legal advice to individuals.)

See a budget adviser

It’s hard, really hard, to think straight with a debt collector breathing down your neck. Budget advisers don’t charge and may have ideas you’ve never thought of or contacts that can help. The New Zealand Federation of Family Budgeting Services can put you in contact with a local adviser in most towns and cities or look under ‘Budget Advice’ in the White Pages. Credit Unions and churches often provide budgeting advice as well and can help coach you financially so that you don’t get into the same mess again.

Negotiate

Under the Credit Contracts and Consumer Finance Act, lenders must consider a ‘hardship application’, but you need to get in first before it’s too late. Once your debt has been passed to the debt collectors this becomes a whole lot harder. Budget advisers will often negotiate with your creditors on your behalf. If not, front up yourself in person or by phone with payment plan that you can meet.

Insolvency

If your finances are a dog’s breakfast and you think you have no hope of ever paying your debts down, the answer could be a Summary Instalment Order (SIO) or the No Asset Procedure (NAP). A SIO is a debt repayment plan agreed by the Insolvency and Trustee Service, which allows you to pay your debts in instalments over three years. You can’t be chased in the meantime providing you stick to your agreement. If you still can’t pay, you could apply for the NAP, which is a simple form of insolvency and could wipe away up to $47,000 of debts. If you use the NAP there are some consequences. For example, you won’t be able to borrow more than $1,000 during the period of the NAP, and the NAP stays on your credit record for up to four years after the discharge from the NAP, making it hard to open bank accounts, take out insurance, rent a home, or get a job. It also affects your credit score. Sometimes learning from the grind of paying off debt may be more useful long term than walking away. Don’t make a decision until you’ve seen a budget adviser.

Know your rights when it comes to dealing with debt collectors. And whatever you do, don’t stick your head in the sand. People can climb their way out of all sorts of financial holes. But only by taking action. If nothing else, call a budget adviser today for free on 0508 283 438.

The post How to deal with debt collectors – including your rights and privacy appeared first on Credit Simple NZ.

An acquaintance said to me – rather smugly – the other day, “I don’t need to check my credit score, because I don’t have a credit history.”

“Oh, you don’t?” I said. “Have you checked it in the past and discovered you didn’t have a profile in the system?”

“No,” he said. “But I’ve never had any hire purchases or a car loan, so they won’t have anything on me.”

Many people think that a credit history is built solely from credit such as hire purchases, or from bankruptcies or court judgements. And indeed, when you go bankrupt or have a court judgement against you, or you default on something like a hire purchase payment, that goes onto your credit history.

Naughty stuff like this is what we call ‘negative’ information. But now there’s also ‘positive’ information, or ‘comprehensive’ credit reporting. That means that a lot more information now goes into your credit history.

“Do you have a power account in your name?” I asked. “What about your smartphone, and your home internet? Ever applied for a tenancy?”

Sure enough, it turned out he’s got all of these (and more) in his name. So I pointed out that it’s almost certain he indeed does have a credit history, because when you apply for power, phone, internet accounts (and so on), you check the ‘terms and conditions’ box, allowing that company to a) do a credit check on you and b) supply your payment history to credit reporting agencies.

All these things go into the calculation that makes up your credit score. So as you make payments each month, that information helps to show how financially responsible you are, and it gives companies an idea of whether or not you’ll be a good customer for them.

On the flip side of the credit coin, what doesn’t go into your score calculation? Well, assets, wealth and income aren’t part of your credit history. You could own umpteen properties, earn squillions, have loads of money in the bank but have a bad bill payment history and have a credit score that’s in the mud. Or you could be financially poor and have an excellent credit score, because you’re meticulous about paying bills on time.

It’s all about how well you manage your finances.

The post So you think you don’t have a credit history … appeared first on Credit Simple NZ.

We got an email the other day from a guy who wanted his account deleted. He’d registered for Credit Simple, discovered his credit score was in the 200s, and decided the best thing was to just wipe it all off the history of the world, immediately and forever.

Great idea in theory. And many people point to other parts of the world where there’s such a thing as “the right to be forgotten”, where you can apply to have things wiped. 

So here’s a few key facts on deleting your credit info:

• You can terminate your Credit Simple account by emailing us.
• Terminating your Credit Simple account means you won’t be able to access your account via the Credit Simple website, and we won’t contact you or send you birthday cakes*.
• We pull our credit information from illion. It’s a leading credit reporting agency, which means it’s allowed by law to collect information on people applying for credit (more on that in a bit).
• When you apply for credit (such as a phone or power account, a credit card, loan or mortgage), you give permission for that company to do a credit check on you – it’s in the terms and conditions. That also gives them permission to share your information with credit reporting agencies. In the same way, when you use Credit Simple to request your credit score, you give Credit Simple permission to share your information with illion.
• You can’t get your credit history deleted, because you gave the company and the credit reporting agencies permission to collect, share, and hold your information.
• However, you can access your private information held about you at any time, as well as ask for it to be corrected. Credit reporting agencies (and Credit Simple) have to adhere to the Privacy Act and credit reporting agencies also have to adhere to the Credit Reporting Privacy Code. If you think we’ve been naughty, you can complain directly to us, and also to the Privacy Commissioner.
• Information you provide to get your credit score from Credit Simple won’t be disclosed for debt collection purposes.

Finally, remember that a credit history can actually be a really good thing to have. It can show you can be financially responsible and handle your money. Companies looking to lend to you want to know if you’ll pay your bills on time  –  imagine having several hundred thousand customers who all paid a day late, for example! And they want to know you’ve got a track record for taking care of business.

You can check your credit score and credit information here. Got questions? Just email us, or get in touch at our social pages, below.

*We don’t usually send you birthday cakes, just saying.

The post Help! I want to delete my credit history appeared first on Credit Simple NZ.

Imagine you’re on the cusp of getting a hot new job, and your prospective boss says they’ll need to do a credit check. You’re pretty sure there’s some bad info on there, and anyway, isn’t it a breach of privacy?

Fret no more, dear reader: we bring good news.

Firstly, it’s true that other parties can check your credit report – landlords, recruiters, telcos, insurance providers and utility companies, as well as employers. However, they can’t do it without your consent and knowledge. The Credit Reporting Privacy Code, along with the Privacy Act 1993, gives you specific rights and information, including who can access your credit report and on what basis.

Employers are only allowed to access your credit report if: a) it’s authorised by you; b) it’s for a pre-employment check; and c) the position you would be in involves “significant financial risk”. That’s more than just cash handling – it should be bigger responsibilities such as accounts and financial administration.

While private information such as the amount of your mortgage appears on your credit report, employers are really looking for patterns of money mismanagement and unresolved debt. However, the biggest indication of that is insolvency, and anyone can search the insolvency register, as that’s public information.

Key things to know:

• The prospective employer MUST get written consent to do a credit check on you. You of course have the right to say no.
• The credit reporter must log each ‘access’ that’s made to your credit file and let you know this information if you ask. These ‘accesses’ are included on your credit report.
• A credit report is different from a credit score. A credit score is a number that’s indicative of your financial health and responsibility, whereas a credit report is a full file containing details of defaults, court judgements, credit applications and more. An employer will want to access your credit report, not your credit score.

The best thing to do? Be prepared by checking your credit score (click here to do it instantly) and requesting your credit report.

The post Help! My new boss wants to check my credit report appeared first on Credit Simple NZ.