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Can a Credit Repair Company Remove Defaults in Australia?

Can a credit repair company legally remove defaults in Australia? Yes — here's exactly how, when it works, what to look for, and how to avoid scams.

Elisa Rothschild
Elisa Rothschild
Principal Solicitor & Director | BA/LLB | ACL 532003
Published: 28 February 2026Updated: 28 February 20267 min read

Key Takeaway

Yes — an ASIC-licensed credit repair company can legally remove defaults from your Australian credit file, but only when those defaults were listed in breach of the Privacy Act 1988 or Credit Reporting Code. The most common grounds are: no Section 21D pre-listing notice was issued, the default was listed during an active dispute, the amount is incorrect, or the debt is statute-barred. No company — licensed or otherwise — can legally remove a correctly listed default simply by asking.

Quick Answer: Yes — an ASIC-licensed credit repair company can legally remove defaults from your Australian credit file, but only when those defaults were listed in breach of the Privacy Act 1988 or Credit Reporting Code. The most common grounds are: no Section 21D pre-listing notice was issued, the default was listed during an active dispute, the amount is incorrect, or the debt is statute-barred. No company — licensed or otherwise — can legally remove a correctly listed default simply by asking.


It's a fair question, and one worth getting a precise answer on. The short version: yes, credit repair companies can remove defaults. The longer version: it depends entirely on how the default was listed and whether it meets legal grounds for removal.

If you've been told by a company that they can remove any negative entry on your file — no questions, guaranteed — that's a red flag. Legitimate credit repair is a legal process, not a magic trick.


How Legitimate Default Removal Actually Works

Under the Privacy Act 1988, all Australians have the right to dispute inaccurate, incomplete, or unlawfully listed information on their credit file. An ASIC-licensed credit repair company acts on your behalf to investigate the listing, identify any breach of the law, and formally challenge the entry with the credit provider and bureau.

If the listing is found to be unlawful, the credit provider is required by law to remove it. Removal is not a favour — it's a legal obligation.

The process typically works like this:

  1. The credit repair company obtains your full credit reports from all three bureaus
  2. They review each negative entry for potential legal grounds
  3. They investigate the specific listing — requesting creditor files, confirming notice dates, checking dispute logs
  4. Where grounds exist, they lodge a formal written dispute with the credit provider
  5. If the creditor refuses to cooperate, the matter is escalated to AFCA or through the legal system
  6. On successful removal, the bureau updates your file — usually within 30 days of the creditor's acknowledgement

Grounds on Which Defaults Can Be Legally Removed

Ground for RemovalWhat It MeansHow Common
No Section 21D noticeCreditor skipped the required 30-day pre-listing noticeVery common
Listed during active disputeDefault listed while a formal complaint was openCommon
Incorrect amountThe dollar figure listed is wrongModerately common
Statute-barred debtDebt older than limitation period (6 years most states)Less common
Identity errorAnother person's debt on your fileOccasional
Expired — not removedDefault past 5 years still showingOccasional
Settled — not updatedDebt paid/resolved but still showing as active defaultCommon

The first two grounds — no Section 21D notice and listing during a dispute — are the most frequent and often the easiest to prove with documentation.


What Legitimate Credit Repair Companies Cannot Do

This matters as much as what they can do. A legitimate, ASIC-licensed credit repair company cannot legally:

  • Remove a default that was correctly listed, with proper notice, for a debt you genuinely owed at the time
  • Guarantee removal before reviewing your specific file and the specific listing circumstances
  • Create a "new" credit identity for you (this is illegal)
  • Dispute entries repeatedly with no legal basis just to confuse bureaus (this does not work in Australia)

Any company making these promises is operating unethically, potentially illegally, and almost certainly taking your money without delivering results.


Real Case Study: Connor, Perth — Paid $2,200 to an Unlicensed Operator. Then Called ACS.

Connor, 41, an electrician from Perth, had a $890 default on his file from a telecommunications company. He'd found a company online advertising "guaranteed default removal" and paid $2,200 upfront. After three months, nothing had changed. The company stopped returning his calls.

He contacted ACS. During his free assessment, we identified that the telco default had been listed without the required Section 21D notice — a clear breach of the Privacy Act 1988. We also found a second default from an energy provider he hadn't noticed, listed the same week he'd formally complained to the Energy Ombudsman.

We challenged both. The telco removed their default in 19 days. The energy provider removed theirs on day 37. Connor's Equifax score moved from 447 to 698.

Result: Connor's Equifax score moved from 447 to 698 in 37 days after engaging ACS. Both defaults removed. He was subsequently approved for a vehicle loan at a mainstream rate. He only paid ACS when we succeeded — unlike the $2,200 he'd lost to the unlicensed operator. Subject to individual assessment; results may vary.


How to Tell a Legitimate Company From a Scam

Legitimate (ASIC-Licensed)Scam / Unlicensed
Holds ASIC Australian Credit LicenceNo ASIC licence — verify at asic.gov.au
Free initial assessmentDemands large upfront payment
No Win No Fee structure"Guaranteed" results before seeing your file
Explains the legal basis for each challengeVague promises, no process explanation
Escalates through AFCA if neededDisappears after payment
Provides written agreementNo formal contract
Independently verified reviewsOnly testimonials on their own site

Always verify an Australian Credit Licence at asic.gov.au. ACS holds ACL 532003, which you can confirm directly.


Frequently Asked Questions

Is it legal for a credit repair company to remove defaults in Australia? Yes — it is completely legal for an ASIC-licensed credit repair company to challenge and remove defaults that were listed unlawfully under the Privacy Act 1988. The right to dispute inaccurate or incorrectly listed credit information is enshrined in Australian law. What is illegal is creating a false credit identity, lodging vexatious disputes with no legal basis, or claiming you can remove any listing regardless of the circumstances.

How long does default removal take? Typically 30–90 days from engaging a credit repair company, depending on how quickly the credit provider responds to the dispute. Simple cases with clear evidence — like a missing Section 21D notice — can resolve in 2–4 weeks. More complex cases involving multiple parties or bureau escalations can take longer.

Do I need a credit repair company, or can I challenge a default myself? You can challenge defaults yourself under the Privacy Act 1988 — the right belongs to you. The advantage of using a professional service is experience: knowing what grounds to look for, how to document the case, and how to escalate effectively if the creditor pushes back. Success rates for professional removal are significantly higher than DIY challenges, particularly for complex or high-value cases.

What happens if the credit repair company can't remove the default? With a legitimate No Win No Fee company like ACS, if the default cannot be removed on legal grounds, you pay nothing for the removal attempt. You only pay a success fee when a default is actually removed. This structure means the company's interests are aligned with yours — they're motivated to take on cases they genuinely believe they can win.

Can a credit repair company remove court judgements? Court judgements are harder to remove than defaults because they involve a legal ruling, not just a creditor's listing decision. Removal requires demonstrating either an error in the original proceedings, that the judgement was satisfied and the creditor failed to update the file, or other specific legal grounds. ACS assesses judgements on a case-by-case basis.

How much does credit repair cost in Australia? ASIC-licensed credit repair operates on a No Win No Fee basis — you pay nothing if the challenge fails. There is typically an administration fee at the start of the process and a success fee only charged when a default is actually removed. Be very wary of any company demanding thousands of dollars upfront before doing any work.


Find Out What's on Your File and What Can Be Removed

A free assessment from Australian Credit Solutions reviews every negative entry on your credit file and provides an honest assessment of which can be challenged — and which can't. No pressure, no obligation, no upfront payment.

Australian Credit Solutions is ASIC-licensed (ACL 532003), lawyer-led by Principal Solicitor Elisa Rothschild, and has helped over 5,000 Australians remove unlawful defaults and rebuild their credit since 2014. No Win No Fee. 98% success rate on accepted cases.

Get My Free Assessment → 📞 0489 265 737 🛡️ ASIC Licensed ACL 532003 | ⭐ 4.9/5 from 976+ Reviews | 🏆 Award Winner 2022–2024


Australian Credit Solutions Pty Ltd holds Australian Credit Licence ACL 532003. Credit repair services are subject to individual assessment. Results may vary. This article provides general information only and does not constitute legal or financial advice.

Related reading: Default Removal Services → | Best Credit Repair Company →

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Frequently Asked Questions

Yes — it is completely legal for an ASIC-licensed credit repair company to challenge and remove defaults that were listed unlawfully under the Privacy Act 1988. The right to dispute inaccurate or incorrectly listed credit information is enshrined in Australian law. What is illegal is creating a false credit identity, lodging vexatious disputes with no legal basis, or claiming you can remove any listing regardless of the circumstances.
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Elisa Rothschild - Principal Solicitor & Director

Elisa Rothschild

(BA/LLB)

Principal Solicitor & Director

With over 12 years of experience in credit law, Elisa has helped thousands of Australians remove unfair credit listings and rebuild their financial futures. She leads Australian Credit Solutions' legal team with a focus on consumer advocacy and regulatory compliance.

ASIC Licensed
12+ Years Experience
970+ Clients Helped

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Disclaimer: This article is for general information only and does not constitute legal or financial advice. Results vary depending on individual circumstances. Australian Credit Solutions Pty Ltd holds Australian Credit Licence ACL 532003. Always seek professional advice before making financial decisions.
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