Lenders use your credit score (or credit rating) to decide whether to give you credit or lend you money. Knowing this can help you negotiate better deals or understand why a lender rejected you.

Your credit score is based on personal and financial information about you that is kept in your credit report.

You have a right to access your credit score and credit report for free.

If you want to fix something in your credit report, contact https://creditmendaustralia.com.au/

How your credit score is calculated

Your credit score is calculated based on what is in your credit report.

For example:

  • the amount of money you have borrowed.
  • the number of credit applications you have made.
  • whether you pay on time

Depending on the credit reporting agency, your score will be between zero and either 1,000 or 1,200.

The score relates to a five-point scale (excellent, very good, good, average and below average). This helps a lender work out how risky it is for them to lend to you.

A higher score means the lender will consider you less risky. This could mean getting a better deal and saving money.

A lower score will affect your ability to get a loan or credit. See how to improve your credit score.

What is in a Credit Report?

As well as personal information — like your name, date of birth, address and driver’s licence number — your credit report will include all of the following information.

Credit products

For each credit product you have held in the last two years:

  • type of credit product (such as credit card, store card, home loan, personal loan, business loan)
  • credit provider
  • credit limit
  • opening and closing dates of the account
  • joint applicant’s name if any

Repayment history

For each credit product you have held in the last two years:

  • repayment amount
  • when payments were due
  • how often you paid and if you paid by the due date.
  • missed payments (not made within 14 days of the due date), and if you made them.

Defaults on utility bills, credit cards and loans

Your service provider may report your non-payment of a debt (called a ‘default’) to a credit reporting agency. They must notify you before they do so.

This may include defaults on your utility and phone bills.

A service provider can report a default if:

  • the amount owed is $150 or more, and
  • your service provider cannot contact you (called a clearout or Serious Credit infringement.
  • 60 days or more have passed since the due date, and
  • the service provider has asked you to pay the debt either by phone or in writing.

A default stays on your credit report for:

  • five years
  • seven years in the case of a clearout

If you pay the debt, your credit report will still list the default, but it will also show that you have paid it.

Fix mistakes in your credit report

When you get your credit report, check that:

  • all the loans and debts listed are yours
  • details such as your name and date of birth are correct.

If something is wrong or out of date, contact the credit reporting agency and ask them to fix it. This is a free service or contact Credit Mend Australia on 1300 425 610 https://creditmendaustralia.com.au/

We Remove Defaults