Australians taking out personal loans at Christmas more likely to default

13 December 2016, Sydney, Australia: Credit reputation website, Credit Savvy has released findings that show Australians are 1.5 times more likely to default on personal loans taken out before Christmas than at any other time.

The research, performed by credit reporting agency, Experian – on credit trends over the last two years, also notes that there is a 10% spike in Australians applying for personal loans in the December quarter.

Credit cards are not exempt from this concerning trend, with a 10% increase in defaults for credit cards taken out at this time of year.

Dirk Hofman, Managing Director of Credit Savvy encouraged Australians to consider the potential effects on their credit score as a default would remain on their credit file for five years, and any missed repayments leading up to the default can also be recorded for two years.

“We can certainly appreciate the need for credit at this time of year, but we’re hoping Australians go about it in a way that minimises the impact to their credit reputation,” he said.

“It’s important to work out how much you can afford to borrow and realistically pay back each month so that you don’t overextend yourself financially.”

Mr Hofman suggested that a good course of action for consumers was to do their homework first using free online resources.

“Make sure you’re getting a competitive interest rate – there are even personal loans available which reward higher credit scores with better interest rates. You can use a free resource like Credit Savvy to check your credit score and compare credit products side by side.”

About Credit Savvy

Credit is an online credit reputation service that provides Australians with free and ongoing access to their credit score and credit report summary, resources to understand credit reporting, and the ability to compare hundreds of credit products in one place.

For more information, please visit

We act as a credit intermediary and do not provide personal financial, legal or tax advice, or credit assistance of any form. Any content featured on the site is of a general and informative nature only and does not take into account your personal objectives, financial situation or needs. You should consider your needs, along with the product's terms and conditions before making a decision. We do not accept any liability in respect of any product or service which you elect to acquire from any provider.

© 2022 CBA New Digital Businesses Pty Ltd ABN 38 633 072 830 and Australian Credit Licence 516487, trading as Credit Savvy Australia.
Credit Savvy is a trademark of CBA New Digital Businesses Pty Ltd. CBA New Digital Businesses Pty Ltd is a subsidiary of the Commonwealth Bank of Australia ABN 48 123 123 124.

Your security is extremely important to us. Your data is encrypted and we work with industry leading experts to keep your details safe.