Case Examples

 

Case Example 1 - Debra:

Debra is a PA/EA to the managing director of a medium sized building company operating nationally. She is a diligent and intelligent young lady who manages her affairs carefully and keeps good records of her financial dealings.

Debra was engaged to marry Doug. They had both saved really well and with the help of the First Home Owners Grant they were in a position to put a deposit down on a house.

They went to their local finance broker who assured them they ticked all the boxes for the bank to lend them the money to buy the house. They filled in all the forms and went away to sign up on the contract to purchase their chosen home.

A week later the broker rang Debra to say there was a problem. The bank could not proceed with the loan because there was a “credit issue”.

Debra was amazed and shocked… what credit issue? She had just signed up to buy the house! The broker could not tell her what the issue was because he was not told by the bank. The broker advised Debra to get a copy of her credit file. Debra said she had no idea how to go about this.

The broker referred her to Elito. After discussing her situation, the Elito consultant asked her to sign a Privacy Consent Form to enable the credit agency to send a copy of Debra’s credit file to Elito.

Debra’s credit file had a default listed on it for her mobile telephone bill some two years earlier. Debra had paid the bill. Yes, it was paid late but it was paid and Debra had never received a notice from the telecom provider that it intended to list a default against her on her credit file.

Elito’s consultant knew this was an irregular procedure and Debra’s credit file should not have been blemished by the telecom provider. Elito’s consultant asked the broker to tell the bank to hold the loan open while the problem was fixed.

After contact by Elito’s consultant with the telecom provider’s credit bureau (and exchange of information) the error was acknowledged and Debra’s credit file was corrected.

The broker was advised to inform the bank to do a further credit check which showed a clean credit file.

Debra and Doug got their loan and bought their house.

 

Case Example 2 – XYZ Plumbing Pty Ltd

XYZ Plumbing Pty Ltd is a small plumbing business which employs 4 people. The owner/director Ray is proud of the fact that he always pays his bills on time and has a perfect record of payment to Fleece Plumbing Supplies where he purchases all his tools and plumbing consumables on a monthly account.

Ray won a big commercial job – his biggest for years - and had to buy tools and equipment to cater for the job. One of the purchases was a small compressor worth $5000.

When the job started Ray found the compressor was faulty, so he used his old bigger compressor instead. He rang the store manager at Fleece’s (who Ray had got to know quite well) and told him that the compressor was faulty and he would be returning it and would want a credit note on his account. The manager said - “That will be fine. I will put a note on the file and you will get a credit note when you return it.”

Ray got into the job and left the compressor at his shed. He didn’t think about it until he got his monthly account from Fleece’s which had the $5000 cost of the compressor on it. The next day he took the compressor back to Fleece’s. The store manager wasn’t there – he had taken long service leave - and the credit officer was acting as store manager.

Ray told him the history of the compressor. The credit manager looked up the file but there was no note on it from the manager. He told Ray this and said because the compressor had been used (once!!) he could not give a credit note. He could however send it back to the manufacturer and either get a replacement or have it repaired under warranty. The credit officer told Ray that in either case Ray must pay the $5000.

Ray said he did not want the compressor – he bought it thinking it would pay for itself by being fully utilised on the big job, but because it failed, he used his old compressor and now simply wanted to return the compressor. The credit manager refused to budge – Ray must pay and he would be delivered a replacement or repaired compressor.

Ray became incensed and walked out of Fleece’s leaving the compressor with the credit manager. When he got home he wrote a cheque payable to Fleece for the total value of their account less $5000 for the compressor.

Ray got several reminders and demands for payment from Fleece but ignored them. He took his business elsewhere.

One day a Court Summons turned up as registered mail - it showed Fleece was suing XYZ Plumbing Pty Ltd for a debt of $5000 plus legal costs. Ray became very angry and rang Fleece’s store manager (his “friend) who was back from long service leave and made an angry complaint and said he would NEVER pay Fleece a cent. The store manager said he didn’t know about the problem and would look into it and get back to Ray.

Ray didn’t hear any more from Fleece’s.

About three months later Ray wanted to trade his old ute in for a new one tonne ute. He went to the car dealer who offered to arrange his finance for the new ute. Ray was pleased and filled in all the forms. The car dealer said he would submit the finance application and ring Ray the next day with the approval.

The next day Ray got a call from the car dealer who told him his finance was rejected because of “credit issues”. Ray was dumbfounded and angry and told the car dealer he was a perfect payer and had perfect credit. The car dealer said he believed Ray but there was nothing he could do. He said ray needed to see someone who could help and referred ray to Elito.

The Elito consultant obtained a copy of Ray’s credit file (with Ray’s consent) and explained that Fleece had obtained a court judgement against XYZ Plumbing Pty Ltd because he did not file a Defence to the Court Summons within the time prescribed - 21 days – or at all. What Ray needed to do was to have the judgement set aside.

Elito sought the help of Heydon O’Loghlen who issued an Application in the Court to have the judgement set aside. Fleece challenged the Application but the Court found in Ray’s favour and made an order that the judgement be set aside. Elito sent a certified copy of this to the Credit Reporting Agency – Veda – and Ray’s credit file was corrected.

Ray then had his finance approved to buy the ‘ute. Ray never paid a cent for the compressor he had returned to Fleece.