Powered by MOMENTUM MEDIA
subscribe to our newsletter
The 5 credit repair secrets every broker needs to know

The 5 credit repair secrets every broker needs to know

If you want to provide the best service to your financially challenged clients, it’s important you understand credit repair so you can steer them in the right direction.

Credit repair is often portrayed as a dark art, but the concept is actually simple: once you learn the mass of relevant industry regulations, you discover the different buttons you need to push in different situations. So credit repair is actually a science, rather than an art. 

That doesn’t mean brokers should bother learning the intricacies of credit repair – your time would be much more profitably spent winning and servicing clients. But if you understand the basics of credit repair, you’ll become a more skilful broker. 

Advertisement
Advertisement

Here are five credit repair secrets that will allow you to have better conversations with clients whose credit histories are holding them back. 

  1. Only incorrect listings can be removed 

There are two reasons your clients may have damaging listings on their credit file – they were either correctly placed or incorrectly placed. 

Unfortunately, credit providers won’t remove accurate information from a credit file. But they will remove inaccurate information, provided you know how to work with them. 

Takeaway: set realistic expectations for your clients. 

  1. Credit repair can’t be done overnight 

Removing incorrect listings is a process that takes weeks, not days. 

While a good credit repair agency will move fast, they have to liaise with credit providers – and those providers can be big, bureaucratic organisations that operate at a slower pace. 

Takeaway: give conservative timelines to your clients. 

  1. Creditors are willing to negotiate 

Credit providers often take a pragmatic attitude to debts, so they might be willing to offer your clients friendlier payment terms, or even cancel some of their debt. 

This sort of informal negotiation spares the credit providers the hassle of chasing someone for money. 

Takeaway: reassure your clients that all hope is not lost. 

  1. Part 9 Debt Agreements aren’t panaceas 

Part 9 Debt Agreements are a formal renegotiation. Again, they usually involve credit providers accepting less money under a new repayment schedule. 

This time, though, your clients’ name will be entered on the National Personal Insolvency Index and the agreement will be recorded on their credit file, severely damaging their borrowing prospects for at least five years. 

Takeaway: notify your clients about the downsides of Part 9 Debt Agreements. 

  1. Consumers can solve problems themselves 

Your clients might not realise they can do their own credit repair without engaging an agency. 

True, they might find it complicated, stressful and time-consuming. But it won’t cost them a cent. 

Takeaway: tell your clients about the self-service option.

The 5 credit repair secrets every broker needs to know
mortgagebusiness

 

Latest News

Ahead of Parliament returning next week, Prime Minister Scott Morrison has conceded that Australia is facing “challenges and headwinds” ...

Slater and Gordon has filed a class action against AMP claiming compensation for more than 2 million people it alleges have been charged ...

An aggressive monetary policy strategy employed in response to rate cuts in foreign markets would be a “dangerous path to go down”, Rese...

FROM THE WEB
podcast

LATEST PODCAST: Broker share and Westpac U-turn

Do you think the banking royal commission recommendations could negatively impact competition in the mortgage market?

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.