Credit reporting and Veda

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Forums › Finance and wealth management › Credit reporting and Veda

cr250bromo

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#195592 26-Apr-2016 09:30

Kia Ora,

I was a customer of a telco (since 2011) on a pay monthly account, I recently ported my number out to another provider and then tried to setup a new account with the original telco. I was turned down due to credit reasons. Despite always paying on time and in some cases keeping my account in credit. The telco isn't relevant since I won't do business with them anymore out of principle, this is more around credit reporting.

The telco advised me contact Veda, as a failed credit check is most likely due to adverse information they hold. Veda offer a free credit report in 20 working days (the maximum allowable by law), but anyone who has just been turned down for credit will likely want to check their file ASAP to fix up whatever is wrong and therefore needs to pay Veda's $51.95 (outrageous) fee for getting the report in one working day.

There are two newer credit reporting agencies in NZ, Dun and Bradstreet (who do a free report in 10 working days) and Centrix who do a free report in 1 working day (go Centrix!). Everything came back clean, so I wasted time and money to confirm there was nothing wrong with my credit at the direct advice of the telco turning me down.

This is the second time I have been through this exact process when there is nothing wrong with my credit history. The first company accepted they had got my file mixed up with someone elses, but again I had to pay Veda's fee to prove this. I have no problems with companies saying "We regret you don't meet our credit criteria" but saying it's due to adverse information Veda hold when this is clearly not the case is misleading at best. It seems to be a loop – company turning you down advises you to contact Veda – Veda tell you ultimate decision to extend credit rests with the provider, after taking your money or making you wait 20 working days.

Anyone else been through something like this?

UHD

655 posts

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#1541972 26-Apr-2016 10:02

Did you obtain the credit report from Veda? They may have different or incorrect information that Centrix or Dun & Bradstreet do not.

gzt

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#1541973 26-Apr-2016 10:02

Bad. Send a letter to the Telco requesting payment of the $51.95.

cr250bromo

222 posts

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#1542002 26-Apr-2016 10:13

Yup I have all 3 credit reports showing my credit is clean

UHD

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#1542003 26-Apr-2016 10:19

Gutted, mistakes happen but I would have waited the 20 days. No need to pay someone for that information and there is no rush to obtain it since you have already successfully ported to another provider.

Flickky

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#1542182 26-Apr-2016 13:28

Note that some ISPs have credit checks beyond Veda - if your credit history is clean but you may have had old accounts with that provider that could take it in to account.

Rather that or they've gotten the wrong file :p

Dabble

31 posts

Geek
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#1542197 26-Apr-2016 14:02

A credit report needs to be considered as a whole for an overall score. Even if you have no defaults you may be declined credit due to other factors such as the number of enquiries you have made.

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sen8or

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#1542243 26-Apr-2016 14:58

You shouldnt have to obtain another copy of the report, under the Privacy Act, you are entitled to view and / or a copy of any information a company has on you, including details of any credit report.

If Veda hold information that is incorrect, they are also legally obligated to correct it (I can't remember the specific Act, Credit Reporting Act or something similar), so if your details are getting mucked up with someone elses (EG same name but different address / DOB etc) then they have the capacity and legal obligation to fix this, again, not something you should have to pay for I would have thought.

If you are simply failing their credit score, this is a bit tougher, but -

If your score is so low as to be an automatic decline, definitely check into the possibility of a mixed up credit file.

If you score is in the refer band (not good but not bad) then something like a positive reference may be sufficient.

Credit score cards are all different, but all look for things that good or bad payers have in common -

- People who own their own home are inherently less likely to default on credit payments than people who dont.

- People who are stable in their jobs and / or residence are less likely to default.

- People with low level of activity on their credit file are less likely to default.

- People with no previous adverse data are less likely to default

Obviously these are generalisations and there are parameters within each item that a score is allocated against, so if you have just shifted but were in your last house for 10 years this shouldn't have too much of a negative effect, but if you have moved 5 times in the last 6 months, then this will look bad on a score card. Likewise, the $ 40 default to the video shop for late fees you never knew existed shouldn't prevent credit, but if there is more than 1 default or if it is for a big amount, then that will have a negative effect.

These are all things any lender / credit person would (should) know instinctively without the need for a score, but for the "tick the box" paper shufflers at big company's, the score means everything.......

gzt

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#1542257 26-Apr-2016 15:12

How about the 'number of enquiries' metric mentioned earlier?

sen8or

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#1542285 26-Apr-2016 15:42

Yep - as per my comments (low level of activity on their credit file). Generic allowance might be for 0-x enquiries for a "normal" level of activity, over x but lower than y and it would likely be lower scored (most likely neutral or 0), more than y (company's define the parameters usually else stick with the generic Veda scorecard) and it would then be a bigger negative.

Scores are either normally positive (you are assigned positive points for a positive attribute like home ownership), neutral (nil score) or negative. Add up the scores on all the attributes to get the overall score.

Ofcourse setting the scorecard parameters is only part of the equation, there is also monitoring and testing of the parameters which depending on the size of the company can be simple or very complicated - How well did the scorecard do at predicting customer behavior, E.G did customers who recently shifted address demonstrate poorer payment habits than customers who didn't. These things can only be tested overtime and with sample data large enough to be statistically relevant.

gzt

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#1542291 26-Apr-2016 15:57

I think the part I'm not getting is the meaning of 'enquiry' and the range of things that covers.

sen8or

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#1542323 26-Apr-2016 16:30

Anytime someone does an enquiry on your Veda file, it leaves a digital footprint, there is (or at least was) the option for the enquirer to leave details about the application (name of enquirer, type of credit applied for and how much). I don't think the type of enquiry matters in regards to the volume of activity, just the number made (Eg if you go to 4 different banks to shop your mortgage, that will be 4 enquiries).

I think there has been some changes made that now enables them to report on the status of applications (approved, declined, credit taken up or not) to make it more comprehensive.

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cr250bromo

222 posts

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#1542547 27-Apr-2016 07:50

Thanks everyone :)

Have flatted in the same house for 12 years, worked for the same employer for 22 years, Veda score was 628/1000, 7 checks on my file in the past 5 years and all clean. I can see where the telco did the credit check - they did the same thing back in 2011 so two of those 7 checks were them! So I don't think I was confused with someone else. Plus it also shows my two credit card payment histories from 2014 which has always been up to date - this was the start of them recording positive information I think.

My real problem is the telco blaming Veda when Veda had nothing adverse listed. I didn't meet their credit criteria for whatever reason which is fair enough, but I still think sending me on a wild goose chase to Veda was pretty bad. I could have waited 20 business days, but I suspect most people would be concerned enough about their credit to want to find out what the problem is ASAP.

UHD

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#1542556 27-Apr-2016 08:33

I don't see why an adverse credit score would matter so much as to demand fixing so fast. It might pay to call your provider back and ask them what was so bad in your report. Just to see what they say, it might have been an innocent mistake on their part.

sen8or

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#1542575 27-Apr-2016 09:25

Stable in residence, stable in employment, minimal activity on a credit file, they must have some fairly stringent credit policies for you not to qualify. You would easily qualify for most forms of retail credit (GE, Q card, vehicle financing etc) provided serviceability was demonstrated.

keewee01

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#1542576 27-Apr-2016 09:26

UHD:

I don't see why an adverse credit score would matter so much as to demand fixing so fast. It might pay to call your provider back and ask them what was so bad in your report. Just to see what they say, it might have been an innocent mistake on their part.

And if they can't give you the reason, or won't then ask to be put through to their manager and escalate it, ask them to investigate it internally to get answers as to what happened - and demand an apology (if it is justified). Make them actually look at and think about the consequences of their actions.