Last updated: 18 January 2018

Credit FAQ

What is a credit score?

A credit score is a number that represents your credit worthiness in the eyes of a credit provider. It is based on the information in your credit file and indicates the likelihood that you will be able to repay a loan in the future.


How is a credit score calculated?

A credit score is calculated by an algorithm that uses information from your credit file. It looks at patterns in your credit history, characteristics of your credit profile, and aspects of your credit applications. For more information, read our Learning Hub article: How are credit scores calculated?


Can my credit score change?

Yes, your credit score can change from time to time as the information in your credit file changes and ages.


Does everyone have a credit score?

If you are over the age of 18 and have applied for credit it is likely that you will have a credit file and credit score with a credit reporting body such as Experian.


Why don’t I have a credit score?

Your credit score is generated based on the information in your credit file. You may not have a credit score if you have very little or no recent credit history or if the information held on you by the credit reporting body is under a previous name or address.


Is this my only credit score?

A common myth is that there is only one credit score. In reality, you will have many credit scores. Each credit reporting body that holds a credit file about you can provide you a credit score. Even your credit provider may calculate your credit score based on the information they have about you.


I earn a lot of money, why is my credit score low?

Your credit score does not take into account any information about your income, investments or assets. Your credit score is only based on your credit history.


I have a low credit score, can I improve it?

Yes, a low credit score doesn’t stay with you forever. You can improve your credit score by maintaining a healthy credit history. This will take time and requires you demonstrate good financial responsibility with credit. For more information, read our Learning Hub article: How to improve your credit score.


What is a credit report?

A credit report is an extract from your credit file and contains the information about your credit history. It may include your personal information, consumer credit information, publicly available information and your repayment history.


Why do I have a credit report?

If you have applied for credit in Australia, you will likely have a credit report with a credit reporting body. Credit providers use your credit file to assess the likelihood you will be able to repay a loan in the future and determine whether or not to approve your application for credit. Not all providers use all credit reporting bodies though so the information held in each credit file can differ.


What is comprehensive credit reporting?

Comprehensive credit reporting allows your credit providers to include extra (positive) information about your credit history in your credit file. This includes information about your repayment history and additional information about the types of credit you hold.


How do I fix an error on my credit report?

If there is a mistake on your credit report, contact the credit provider and the credit reporting body to have the mistake corrected. If they do not resolve the issue, you can also escalate the matter to the industry ombudsman.


Can I pay someone to remove information from my credit file?

No, information can only be removed from your credit file if it is incorrect or out of date. If this is the case, it is something you can do for free by contacting the relevant credit provider and/or credit reporting body. Beware of credit repair companies that promise to improve your credit score by removing entries from your credit file for a fee.


Is this my only credit report?

No, each credit reporting body maintains their own set of information. You will have a separate credit report with each credit reporting body and each credit report may be different because a credit provider may not send information to every credit reporting body.


Will checking my credit file hurt my credit score?

No, checking your own credit file is known as a soft enquiry and has no effect on your credit score.


I don’t have a credit file or credit score, can I still apply for credit?

Yes. Credit providers look at a range of factors in assessing applications for credit. If you don’t have a full credit file, greater emphasis is put on other aspects of your application such as your income and assets.


I pay all my bills on time, do I still need to check my credit file?

Yes. You should actively monitor your credit file for errors and fraudulent activity. When applying for credit, you don’t want to be caught out by something incorrect on your credit file.


I never took out this product, why is it still on my credit file?

A credit enquiry may be recorded on your credit file each time you apply for credit. It does not indicate if the product was ever taken out, if it is still active or whether it has been paid off.


I had a default listed on my credit file and I have since repaid the debt. Why hasn’t it been removed from my credit file?

A default will remain on your credit file for five years, even after you pay the money back. Once repaid, it is noted on your credit file that the debt was paid in full.


Will my partner’s debt or my family’s debt affect my credit file and credit score?

Your credit file and credit score may be impacted by your partner’s debt or your family’s debt if you have joint credit together or if you have acted as another person’s guarantor.