Can You Remove a Default From Your Credit File in Australia?

Quick Answer: Yes — a default can be removed from your Australian credit file before the 5-year expiry if it was listed in breach of the Privacy Act 1988 or Credit Reporting Code. The most common removable grounds are: no Section 21D pre-listing notice was issued, the default was listed while a genuine dispute was active, the amount is incorrect, or the debt is statute-barred. Professional removal typically takes 30–90 days and produces immediate score improvements of 100–300 points.

This question gets a lot of vague answers online. "It depends." "Sometimes." "Only in certain circumstances." Let's be precise about when it is and isn't possible — and what each situation actually means for you.

When a Default CAN Be Removed

A default can be removed before the 5-year expiry period when it was listed in a way that breached the rules credit providers are legally required to follow under the Privacy Act 1988 and Credit Reporting Code. The breach gives you the right to have the listing corrected — which means removed.

When a Default CANNOT Be Removed Early

A default cannot be removed before 5 years if: it was listed correctly, with proper notice, for the right amount, after the debt was genuinely owed and unpaid, and no procedural rules were broken. It will stay for the full 5-year period and then be automatically removed.

This distinction is critical — and it's what separates legitimate credit repair from operators who overpromise. You cannot remove accurate, lawfully listed defaults. You can remove defaults where the process was broken.

How Often Are Defaults Listed Unlawfully in Australia?

More often than most people realise. In our experience reviewing thousands of Australian credit files since 2014, a substantial proportion of defaults show at least one procedural breach — most commonly the failure to issue a Section 21D pre-listing notice.

The notice requirement under the Privacy Act 1988 is clear: before listing any default of $150 or more, the credit provider must send the debtor a written notice at least 30 days before listing, advising of the intention to list and giving them the opportunity to respond. Many creditors — particularly telcos, utilities, and smaller finance companies — routinely skip this step.

You cannot know whether your default was listed unlawfully without looking at the specific circumstances of your case. That's what the free assessment is for.

Real Case Study: Emma, Darwin — Two Unlawful Defaults She Didn't Know Were Challengeable

Emma, 35, a nurse from Darwin, had been carrying two defaults for over two years — one from a telco ($430) and one from an electricity retailer ($680). Both had been on her Equifax file since 2023. She'd written them off as unavoidable consequences of a difficult period and had been waiting.

Her ACS assessment took 25 minutes. What it found was that neither default had been preceded by a Section 21D pre-listing notice from either creditor. Both had been listed directly without the mandatory 30-day warning to Emma. Both were clear Privacy Act 1988 breaches.

We lodged challenges with both creditors simultaneously. The telco acknowledged the breach within 12 days. The electricity retailer required escalation to the Energy Ombudsman, taking 54 days. By day 61, both defaults were removed.

Result: Emma's Equifax score moved from 431 to 698 — a 267-point improvement in 61 days. She'd been renting and had assumed homeownership was years away. Within four months of her defaults being removed, she applied for a home loan and was pre-approved for $380,000 at 6.49% p.a. She only paid when we succeeded. Subject to individual assessment; results may vary.

How to Find Out If Your Default Is Removable

1. Get your credit report from Equifax, Experian, and Illion — free, no score impact
2. Note the creditor, amount, and listing date for each default
3. Recall whether you received a written notice at least 30 days before the listing date — if you didn't, that's a potential Section 21D breach
4. Consider whether there was an active dispute at the time the default was listed
5. Check if the amount matches what was actually owed at the time
6. Get a professional assessment — ACS reviews your specific file free of charge and tells you clearly what's challengeable and on what grounds

Frequently Asked Questions

Can a default be removed from your credit file in Australia? Yes — if it was listed in breach of the Privacy Act 1988 or Credit Reporting Code. Common removable grounds include no Section 21D pre-listing notice, listing during an active dispute, incorrect amounts, and statute-barred debts. Defaults that were listed correctly with no procedural breaches cannot be removed before the 5-year expiry. A free assessment determines which category your default falls into.

How long does it take to remove a default in Australia? Most successful removals complete in 30–90 days. Simple cases with clear procedural breaches — particularly no Section 21D notice — often resolve in 30–45 days. More contested cases where creditors dispute the challenge can take up to 90 days, particularly when escalated through AFCA at afca.org.au.

Can I remove a default from my credit file myself? Yes — you can self-lodge disputes with the bureau or directly with the creditor. The Privacy Act 1988 gives you the right to request correction of inaccurate or unlawfully listed data. The challenge is identifying the correct grounds and articulating the breach clearly enough to succeed. Professional credit repair services have higher success rates because they know which grounds are strongest and how to present the legal argument.

Does removing a default improve your credit score immediately? Yes — score improvement is immediate when a default is removed. The score is recalculated without the negative entry, and the improvement is typically significant: 80–200 points for a single default removal, and 200–350+ points where multiple entries are removed in the same process.

What is a Section 21D notice and why does it matter? Section 21D of the Privacy Act 1988 requires that a credit provider must send a written notice to a debtor at least 30 days before listing a default on their credit file. The notice must inform the person of the intention to list and give them the opportunity to pay the debt or dispute it. Failure to issue this notice — or issuing it with insufficient lead time — is a procedural breach that makes the resulting default listing unlawful and challengeable.

Can a paid default be removed from your credit file? Yes — if it was listed unlawfully, the paid or unpaid status is irrelevant. The grounds for removal relate to the listing process, not the current payment status of the debt. ACS successfully removes both paid and unpaid defaults where procedural breaches are identified.

Find Out If Your Default Is Removable

A free assessment from Australian Credit Solutions answers this question specifically for your file. We've reviewed thousands of Australian credit files since 2014 and have a 98% success rate on the cases we accept.

Australian Credit Solutions is ASIC-licensed (ACL 532003), lawyer-led by Principal Solicitor Elisa Rothschild. No Win No Fee.

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: How to Remove a Default → | Default Removal Services → | How Long Does a Default Last? →