Learn how your credit score can impact you financially


A credit report is a summary of your financial history, and your credit score is a reflection of how ‘good’ that history is. Finding out your credit score can be a daunting prospect, even though it’s obviously useful to know where you stand.

Having ‘good’ or ‘bad’ credit can seriously impact you financially. A good credit score enables you to borrow more money at better interest rates. But a bad credit score means creditors and lenders see you as a high-risk candidate for a loan and may not want to lend to you at all.

It’s not just about money or mortgages, either. A bad credit score can make life difficult in the following ways:

  • Difficulty getting approved for a rental property. Most landlords check credit before approving a rental application.
  • Hefty security deposits on utilities. Whether it’s electricity, gas or internet, a bad credit score can mean you have to pay a security deposit to establish service in your name.
  • Reduced career opportunities. Certain jobs, especially top-tier ones in the finance sector, require you to have a respectable credit history.
  • Around-the-clock calls from debt collectors. These are not a direct consequence of bad credit, but a likely byproduct of having overdue bills that have led to your bad credit score in the first place.

Who calculates my credit score?

Your credit account history is collected by Equifax, Australia’s largest credit bureau, and compiled into a credit report. Having lots of negative information – such as previous bankruptcies, defaulted loans, late payments or repossessed property – means you will get a bad credit score. Especially if you have multiple instances of these things in a short timeframe.

The frustrating thing, of course, is that if you’re struggling to make ends meet in one area of your life, you’re probably struggling in another. But the rules used to estimate your creditworthiness are tough and the lower your credit score, the riskier you will appear as a borrower.

Your Equifax credit score is a number between 0 and 1,200. Most credit scores operate within the range of 300 to 850. A credit score of 622 or above is generally considered good, however anything lower places you in the bottom 21-40 per cent of the credit-active population.

The good news is, this only sits on your record for maximum five years.

Don’t lose hope if you think you’ve got a bad credit score – in addition to your Equifax credit score, some lenders such as Club Money will apply their own lending criteria. Call us on [phone] to discuss a bad credit solution or apply here.

How do I get a free credit check?

By law, every Australian resident with a credit file is entitled to one free copy of their report per year from one of the major credit reporting agencies. These include Equifax, Dun and Bradstreet, Tasmanian Collection Service and Experian. They will usually dispatch it within ten days of your request – just be aware that if you request it urgently, they may charge a rush fee.

You can streamline the process and choose between any of these credit reporting agencies by visiting AnnualCredit Report.com, an official platform which is authorised by Federal law and guarantees a secure transaction.

There may be other sites that catch your eye which claim to provide a free credit score, but if any of them mention a trial subscription or ask for your credit card information, chances are you’ll be charged or scammed. Federal consumer-rights law has partnered with reputable credit bureaus to offer a simple, centralised way for consumers to get these credit reports so don’t fall for free credit check imposter sites.

What else do I need to know?

Once you have your official credit score, you’ll need to know how to assess it and make sure all the accounts, payment history, and inquiries into your credit are correct. We’ve compiled a handy resource on how to safeguard against mistakes on your credit report and can help you find a stress-free solution with our short-term bad credit loans. No extensive documentation required – we’re here to help, not hassle you.

While it’s impossible to remove a bad credit score, there are things you can do to improve it and better your chances of getting the loans you need without inflated interest rates. The first step is getting a free credit check by visiting AnnualCredit Report.com and getting an idea of where you sit compared to the rest of Australia in the credit-active population.

Get in touch with our friendly, non-judgmental team at Club Money to discuss your credit, and sort through the mumbo-jumbo to the most important details. Call us on [phone] or send us a message here.