How to check your credit rating



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Applying for a home loan, credit card or mobile phone card?

Whatever type of loan or credit you apply for, the decision to approve or reject your application can come down to your credit score (or credit rating, as it is also known).

If you want to find out your credit score, click here.

If you’ve got bad credit and want help, click here.

What is the point of credit scores?

Lenders and credit providers may use your credit score to determine:

  • Whether you can afford to pay off a loan
  • How reliable you will be in making your repayments

So credit scores are important. As a general rule, the better your credit score, the easier you’ll find it to get a loan.

Struggling with debt?

If you’re struggling with debt, you can make a free call to the National Debt Helpline, on 1800 007 007. You can also get free financial counselling. If you’re facing legal action because of your debts, you may be able to get free legal advice.

How are credit scores calculated?

Your credit score is based on your financial behaviour and includes information on your credit cards and loans, including your punctuality in making repayments.

Under the ‘comprehensive credit reporting’ regime, which was introduced in March 2014, credit scores are based on both positive and negative events (as opposed to the old system, which only reflected negative events).

Click here to read more about comprehensive credit reporting.

Positive credit events Negative credit events
Paying your rent on time Not paying your rent on time
Making scheduled loan repayments Missing scheduled loan repayments
Closing loans Defaulting on loans
Having one credit card with a moderate limit Having multiple credit cards with high limits
Paying off your entire credit card debt each month Paying off the minimum credit card debt each month
Not making any unsuccessful credit applications Making any unsuccessful credit applications

What’s your credit score?

If you want to find out your credit score, click here.

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Are credit scores always accurate?

Credit scores are based on the information in your credit file – so if there is incorrect information in your credit file, your credit score may be inaccurate.

Here are some possible inaccuracies that can appear in credit files:

  • Your biographical information might be wrong (such as date of birth)
  • You might have an excessive debt listed against your name ($450,000 instead of $45,000)
  • You might have a debt falsely listed against your name (the debt might actually belong to a family member or a stranger with a similar name)
  • You might have a default falsely listed against your name (the default might have been committed by someone else, or there may not have been any default at all)
  • A fraudster might have taken out credit in your name

What are credit repair agencies?

There are companies, known as credit repair agencies, that offer to fix people’s credit files in return for a fee. Some credit repair agencies are reputable; others exploit vulnerable consumers. ASIC, Australia’s financial services regulator, offers this advice:

  • You don’t need to pay a credit repair agency to remove incorrect information – you can take steps to do it yourself for free
  • Credit repair agencies can’t remove correct information
  • Credit repair agencies may charge excessive fees
  • They may pressure you into entering a service you don’t understand, such as a Part 9 Debt Agreement

How do I fix my credit file?

There are several steps you can take if you want to fix mistakes in your credit file:

  • Contact the credit provider and ask them to fix the mistake
  • Contact the credit reporting bureau and ask them to fix the mistake
  • Take your case to the ombudsman

Please note that you can only fix mistakes. You don’t have the right to demand the removal of correct information from your credit file.

What’s your credit score?

If you want to find out your credit score, click here.

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There are two reasons you should check your credit rating: so you have a better understanding of your financial position, and so you can take action (if necessary) to improve your credit rating.

Lenders often use credit ratings or credit scores to assess loan applications. The higher your score, the more likely you are to get approved – and the more likely you are to be charged lower interest rates and lower fees. Conversely, the lower your credit score, the less likely you are to get approved – and the more likely you are to be charged higher interest rates and higher fees.

If you discover you have a substandard credit rating, there are nine steps you can take to improve it. Those steps include consolidating multiple debts, fixing errors on your credit file, making repayments on time, paying off loans and closing extra credit cards.

^Words such as "top", "best", "cheapest" or "lowest" are not a recommendation or rating of products. This page compares a range of products from selected providers and not all products or providers are included in the comparison. There is no such thing as a 'one- size-fits-all' financial product. The best loan, credit card, superannuation account or bank account for you might not be the best choice for someone else. Before selecting any financial product you should read the fine print carefully, including the product disclosure statement, fact sheet or terms and conditions document and obtain professional financial advice on whether a product is right for you and your finances.

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