What's a credit score and how can you improve yours?

If you're planning to apply for a personal loan, home loan or another form of credit, it's important your credit score is in good shape. Not sure what a credit score is, or how you can improve it? Don't worry - this article and the infographic below provide you with all the information you need to know!

Your Equifax Credit Score is a number between 0 and 1,200.

What is a credit score?

Your Equifax Credit Score is a number between 0 and 1,200. It uses the information on your credit report at a point in time and translates this into a numerical figure. A credit score is only one part of the information lenders may use to help assess  a credit application. They may also use details on an application form, any information they have on you (if you’re an existing customer) and make a decision based on their own lending policies and criteria.

How is your credit score calculated?

Equifax sources information from credit providers and public record information, such as court writs and judgements relating to credit, to generate your credit score using a special algorithm that gives weighting to different variables. We use this algorithm to compare your credit behaviour to the rest of Australia's population. Your Equifax Credit Score is dynamic and is generated based on the information on your  credit file at a point in time.


The higher your credit score, the more likely it is that providers will grant you credit.

​The higher your credit score, the better, as it indicates a lower risk.


What affects your credit score?

The important thing to bear in mind is that your credit score can fluctuate as information on your credit report changes. So if your credit behaviour improves then your score can change to reflect this. Your credit score is affected by factors such as:

  • Your repayment history
  • Applications you've made for credit
  • Unpaid debts or defaults
  • Adverse information like court writs and judgements
  • Credit limits
  • Personal information
  • The age of your credit report

How can I improve my credit score?

There are a number of ways you can help improve your credit score:

  • Check your Equifax Credit Score and get a copy of your Equifax Credit Report. That way, you can see what it is, and whether you need to take action to improve it. 
  • Pay off your debts and close your credit card accounts, refinancing or consolidating them to make it easier to pay off.
  • Pay your mortgage, personal loans, credit cards, phone and utility bills in full every month.
  • Only apply for credit when you need it – shopping around for credit, making lots of applications in a short amount of time can negatively impact your credit score.

Want to know more? You can obtain a free copy of your credit report here or have a look at our subscription packages that includes credit scores and credit alerts.