Credit Score Check: What Does This Mean?

Credit Score Check

A credit score check from Equifax is one of the best ways to maintain your credit history and health. In these reports, you’ll find who has checked your credit history and what organisations currently provide you with credit. The report will also cover past credit applications and your repayment history (if provided by your lender). The credit history report is your best tool for uncovering any issues with your credit (ID theft, a privacy breach, bad credit history, etc.).
If you are refused credit for any loan application, it is unlikely your lender will confirm as to the reason why. In this situation, it is best to complete a credit score check and see if there is a problem with your credit score rating. If defaults are recorded, you can start to clear these from your credit history. In most instances, default is caused by missing payments on a loan. These missed payments can be for various reasons; perhaps the lender lost contact with you when you moved homes.
There are instances where you may not receive a loan because your credit score is too low. While you may have enough money and the means to pay out any loans, some lenders may be unwilling to lend you an amount you desire if you have no existing credit history. In Australia, banks and financial institutions tend to be cautious, and they prefer to loan money to people who have a reputation and proven ability to pay back a loan. This means that banks can use the information in your credit report to determine if you are a suitable candidate for a loan.
If you have a bad credit score, you can take steps to help improve it. These steps may include paying your bills regularly and paying any outstanding loan debts. Many factors go into building your credit history, and with professional advice, you can aim to create a positive credit score. At Equifax, we can share tips and steps you can take to improve your credit rating.

What is a credit score?

A credit score is based on your borrowing and repayment history. If you’ve missed payments, including bills, then you may have a lower credit score than someone who always pays on time. Other factors that count towards your credit rating include how often you have applied for credit. If you have a lot of personal debt or haven’t disclosed an existing loan (including credit cards). This may reduce your ability to secure a loan or line of credit.
Lenders (i.e., banks and other financial institutions) will use the information to determine if they feel you are a reasonable risk to take. If they feel you are a high-risk customer, they may provide you with a loan with a higher-than-average interest rate. If you have been refused a loan, it is best to use a credit score checker and uncover why. From that point, you can make changes to improve your credit score.

How is credit score calculated?

Your credit score is calculated by credit reporting agencies, such as Equifax. A credit reporting agency will calculate your credit score using various methods and scales. At Equifax, we use a scale from 0 to 1200, and the higher your number, the better your credit score. A good credit score is considered to be between 726 to 832, and an excellent score is 833 to 1200, but your lender may have used their own preferred guide for loan approvals.
Many details go into creating your credit score, and you should perform a credit score check at least once per year. Knowing your credit score can help you determine if applying for credit is worthwhile, as applying for credit through many lenders may lower your credit score. Understanding your credit score can help you change your financial situation and make yourself more appealing to lenders. While it may be possible to complete a credit repair, it is best to make sure you are consistently meeting your current financial obligations. For example, if you’ve been refused a large loan for a home due to a low credit rating, you may find that borrowing a small amount and successfully paying it off can improve your overall credit score.
At all times, you can keep a close watch by regularly completing a credit score check yourself. In our subscription service, we can monitor your credit score and alert you to any changes as they occur. Some factors that may affect your credit score can include the following:

  • Your current and past debt, including any issues you had making regular payments
  • Loans for household, personal, and family reasons (including consolidation loans, refinancing, or being a guarantor for other people)
  • Credit cards and store cards calculated at their maximum limit
  • Default judgement or bankruptcy recorded against your name (if applicable)

How to check your credit score?

If you find yourself searching ‘how to check my score’, we’re happy to tell you it’s easy to complete a credit score check through Equifax. You can get a credit report for free at certain times, or if you prefer, you can sign up for our regular reporting services. The report we provide will show you the details of your credit history. You should read through this and determine if there are any discrepancies. If you feel something is incorrect, you can contact our team, and we’ll investigate the issue and then provide more details about that particular item.
When you apply for a credit score checker, you’ll need to supply some documents and information such as your full name, driver’s licence number, current residential address, previous addresses, your current employer or previous employer, and the name of the organisation to which you last applied for credit.

After you supply these and we have verified your identity, your report will be prepared and sent to you. If you need any assistance with your credit report, please feel free to contact us on 13 8332 and follow the prompt.

Disclaimer: The information contained in this article is general in nature and does not take into account your personal objectives, financial situation or needs. Therefore, you should consider whether the information is appropriate to your circumstance before acting on it, and where appropriate, seek professional advice from a finance professional such as an adviser.