When searching for how to check your credit score in Australia, you can often be met with a series of different results, and choosing the best option may seem overwhelming. However, carrying out a credit check is straightforward and can yield several benefits when planning your finances.
Does It Cost Money to Carry Out a Credit Score Check?
Some online credit score platforms charge a fee when viewing a credit score, but this often includes other services that not everyone needs. Fortunately, you can gain a copy of your credit report for free every three months.
You should be mindful that there are three credit reference agencies, and each may hold different information about you. The contact details for each reporting agency are as follows.
Equifax: Apply Online or Call: 1300 783 684
Experian: Apply Online or Call: 138 332
Illion: Apply Online or Call: 132 333
When checking your credit report online, you can typically gain instant access. If you’re ordering by telephone, you should allow ten days for delivery. There will be instances when each credit reference agency offers monthly monitoring for a fee, but this is not needed when carrying out a credit check in Australia.
What Is Needed to Carry Out a Credit Score Check?
Given the sensitive nature of a credit check, agencies will often ask for identification. A list of acceptable documentation for credit checks is as follows.
- Passport
- Drivers License
- Australian Medicare Card
- Centrelink Card
In addition to photographic identification, you will also need to provide your name and address, plus any past addresses if you have recently moved.
What Are The Benefits of Checking Your Credit Score in Australia?
If you have ever applied for a loan or credit card and been rejected, you will have undoubtedly been frustrated. Being rejected for finance doesn’t mean you have a poor credit score, but there could be information on one of the reports affecting your ability to obtain credit.
As you can obtain a copy of your credit report every three months, you should use this to your advantage to monitor your credit score. Checking the reports regularly also ensures that you can contest any incorrect information.
If missed payments, defaults, or court judgments are shown, these will affect your credit score. However, this doesn’t mean you cannot improve your credit report over time. Even when a good credit score is shown, you can take additional measures to ensure your credit score is the best it can be.
What Factors Affect a Credit Score Check in Australia?
There are several factors that can help increase a credit score as well as reduce it. The following is an overview of the positive and negative behaviors that influence a credit score.
Behaviors That Decrease a Credit Score
There are several behaviors that can lead to a decreased credit score, including the following.
Late Payments
Although late payments are less detrimental than other behaviors, an ongoing pattern could mean companies refuse credit.
Hard Credit Searches
Hard credit searches are when a business conducts a credit check for the purpose of credit. If several loans or credit cards are applied for within a short duration, this could lead to a decreased credit score.
Defaults
If a company has been unable to collect money via conventional methods, then it will often enlist the services of a collection agency, which also decreases your credit score.
Bankruptcy
Very few will need advice about how detrimental bankruptcy can be, and if it’s shown on a credit report, it will reduce a credit score significantly.
‘Bad’ Debt
Although a person needs some form of debt to create a credit report, there could be some details on a credit report that could cause concern. Examples include payday and high interest loans.
Behaviors That Increase a Credit Score
Those trying to increase their credit score in Australia should consider the following methods.
Pay Bills on Time
It may seem obvious, but ensuring all payments are made on time makes all the difference when increasing a credit score.
Having Some Debt
Although bad debt is considered a decreasing factor of credit reports, student loans and business loans are considered ‘good’ credit and can therefore increase your credit score.
Keeping Personal Information Updated
Those who have recently moved or married should ensure that all financial records are updated as soon as possible. Correct information ensures your credit score increases when using without positive financial behavior.
Ensuring You Maintain a Good Credit Score
Viewing defaults, judgments, or missed payments on a credit report can be disheartening, but you can take some steps to improve your score in the future.
Firstly, you must check all three reports to ensure you’re fully aware of any missed payment judgments and defaults.
Missed payments are kept on a credit file for two years, whereas defaults remain for five years. Although bringing accounts up to date won’t remove the defaults or judgments, it does show lenders or employers that efforts are being made to rectify credit issues.
If there are no defaults or missed payments listed, but you’re struggling to obtain credit, then there may be too little credit history to allow businesses to make a decision. Fortunately, something as simple as a credit card can help create some credit history, and will not incur a cost if paid off in full each month.
However, when searching for a credit card or other form of credit like a phone contract, the terms and conditions must be read before making a commitment.
Despite many people assuming that obtaining a credit report and monitoring their score will incur expense, it can be carried out free of charge when using the right methods.
Although there are additional services available for a fee, those wanting to make improvements to their score and keep track of their credit reports in Australia do not need to part with money when doing so.
Click here if you’re looking to improve your credit score. Or here if you want to find out more information about your credit score.