Will payment deferrals due to covid-19 affect my credit score?

If consumers have had to delay repayments due to being affected by COVID19, it has been confirmed by ABA (Australian Banking Association) that credit scores will not be affected, but customers do need to be up to date with their repayments beforehand.  

Due to COVID19, if consumers are approved to defer repayments on their mortgage and any other credit products, banks will report consumers to CRP (credit reporting body) as not having missed a repayment, provided they were all up to date when granted relief.  

If consumers have postponed their mortgage repayments due to COVID-19, the banks will not report the repayment history. This field will be left blank on your credit file throughout the time of the deferral period. 

Banks and lenders will not report any information for consumers who have arranged a deferral and were already behind in repayments, however after the deferral period ends, banks will then decide how to report the repayment history. But, if a consumer has not informed their bank about their financial hardship, then any missed repayments during COVID-19 will still be reported to the credit reporting body (CRB) and lower your credit score.  

Therefore, it is best you contact your bank as soon as possible if you’re going through financial hardship due to COVID-19 and cannot make payments on your home loan.  

What happens after the deferral period ends? 

Consumers who are coming to the end of their repayment ‘holiday’ period, have some options which include extending the repayment, resuming repayments, changing to interest-only or other options which you can find this information by contacting your bank or lender. 

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