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FAQ - Credit Defaults

Why credit default a debtor?

Potential credit providers may look unfavourably on applicants with a history of overdue accounts. Both consumers and commercial payment defaults stay on your credit report for five years, even when you have paid the overdue amount. The fact that an account has become overdue and then been paid becomes part of your credit history. If they want the status of the default updated to ‘paid they must pay you.


Can you credit default a business?

Yes, we can place a default on their credit file for a period of 5 years. The debt must be at least 60 days overdue and over $100 in value. To enable us to do this, we would require your consent by the way of a Default Register Form which needs to be signed and returned to us. We then issue a ‘default warning’ letter to the debtor at the last known address, which states that after 7 days from the date of the letter, that, if the account is not paid in full, a Mercantile Agent Default will be lodged with Veda Advantage Ltd. This is usually enough to get the debtor to pay their account. Once the account has been paid we have the ability to ‘update’ the default listing to ‘paid’ or ‘settled’.


Can you credit default a consumer?

Yes, you must have the correct documentation signed by your customer which allows for credit default reporting with Veda Advantage Ltd. Also you need to become a credit reporter with Veda Advantage Ltd which we can organise for you.

The debt must be at least 60 days overdue and over $150 in value. Before listing a consumer default, you must take a number of steps including sending a notice to their last known address requesting payment and sending another separate notice stating that the debt may be listed with a credit reporting body. This is usually enough to get the debtor to pay their account. Once the account has been paid you have the ability to ‘update’ the default listing to ‘paid’ or ‘settled’.  A default will stay on their credit file for a period of 5 years.


Who is Veda Advantage Ltd?

Veda is the largest credit reference agency in Australia and New Zealand. It provides credit reporting, credit scoring, and marketing analytics services. Veda’s data includes credit information on 20 million individuals and 5.7 million commercial entities in Australia and New Zealand.


What happens to the credit default once the debtor has paid?

You must notify us once the debtor has paid so that their credit file can be updated to ‘paid’. Even though we update the status of the default to ‘paid’ the default remains on their credit file to let other organisations know they were a late payer.