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Nicholas took out a personal loan of approximately $8,000 in May 2016 to be repaid over five years. Nicholas and the lender agreed on amended loan repayment arrangements multiple times before Nicholas stopped making payments entirely in mid-2019.

The lender wrote to Nicholas’ listed address in January 2020 to tell Nicholas they intended to take debt recovery action, including lodging a default listing on his credit file. Nicholas did not respond to the lender, so the lender wrote to Nicholas in April 2020 saying that the debt had been sold to a debt collection agency.

Nicholas contacted the lender to request that the default entry be removed from his credit file, but they advised that only the debt collection agency could amend the listing. The debt collection agency said that only the lender could amend the listing.

After further communication, the debt collection agency said that they would amend Nicholas’ credit report entry on the condition that Nicholas enter into a repayment plan. The debt collection agency also requested a statement of financial position to ensure that any repayments were affordable. Nicholas was not happy with this proposed resolution, and in October 2020 he complained to FSCL about the debt collection agency.


Nicholas said that the debt collection agency should not have placed a default entry on his credit report because the letters notifying the sale of the debt and the default entry had been sent to his previous address, and he had not been correctly notified. Nicholas said that he would not agree to repay the debt until the default entry on his credit report was removed.

The debt collection agency said the letters were sent to the correct address on file and they would amend the credit report if Nicholas agreed to a repayment arrangement.


We found that the debt collection agency had offered Nicholas a reasonable resolution and he should discontinue his complaint.

We found that the debt collection agency had followed the correct process when notifying Nicholas that they had bought the debt. Under Nicholas’ loan agreements he was obliged to update his address. There was no evidence that Nicholas had informed the lender that he had moved, and the debt collection agency had sent the notice to Nicholas’ most recent known address.

We considered the debt collection agency’s offer to record the debt as “being repaid”, rather than a “default”, was reasonable. We agreed with the debt collection agency that there were no grounds to remove the default listing entirely as the default had been properly listed, notices had been correctly issued to Nicholas’ last known address, and there was no evidence of extenuating circumstances such as unforeseen hardship.

If Nicholas would not provide the debt collection agency with a statement of financial position and enter into a repayment arrangement, we could not help him further. While there was miscommunication initially regarding which party entered the default listing, the debt collection agency were willing to work with Nicholas to ensure any reference to the debt on his credit file was as favourable as possible while acknowledging that the debt remained in default.


We suggested that Nicholas discontinue his complaint. Nicholas did not agree with our preliminary decision but he did not provide any new evidence that changed our view so we could not take his complaint any further.

Insights for consumers

Consumers should make reasonable efforts to arrange a repayment schedule with a debt collection agency if they wish to have a default listing amended on their credit report. We also remind consumers to give their lender their new address when they move house.