Credit score: Does it actually matter in Australia?

Here’s the thing! Knowing your credit score and what it does is important if you want to move forward with your financial journey. Let’s unpack the basics together.

What's a credit score, and why does it matter?

Your credit score becomes important when you want to borrow money—whether from a bank, for a credit card, or even a payment plan.

In Australia, your score can be determined by a credit bureau, such as illion. The score you get is based on your personal and financial information and history.

A lender will look at your score to decide how likely you are to repay the money you borrow from them.

Your score is an important factor when you apply for a home loan—and it can make or break a deal! The higher your score, the more likely you'll have your loan approved!

What if I don’t know my credit score?

Knowing what your credit score is can actually be pretty handy. There are a few reasons behind this.

A good score could help you negotiate a better deal. And, well… if it’s not so good, you’ll understand why your application might have been rejected.

In Australia, credit scores are usually between zero and 1,200, and the higher the number, the better.

How's my score calculated?

Your credit score is calculated on a couple of factors, including:

• Your payment history (i.e. do you pay your bills and loans on time?)
• How much money you’ve borrowed in the past
• Any loans you’ve applied for

Of course, making multiple applications for loans in a short period can also impact your score.

How can I start building up my score?

If your credit score isn’t as healthy as you’d like, don’t worry! Check the information in your report to make sure it’s accurate.

From there, there are a few simple things you can do to make life easier:

• Ensure you pay your bills on time
• Make any repayments on time
• Don’t make unnecessary credit applications

These simple tips can help your score stay healthy when you need it.

What else can I do to build my score?

RentPay’s digital wallet gives you more control, flexibility and choice in how you pay rent. One of the great optional features worth considering is Scorebuilder.

Each month you have the Scorebuilder feature, we report your account status to one of Australia’s largest credit reporting bodies.

If you maintain a good account status, reporting that data to the body over time can positively impact your credit score.

Find out more about how RentPay can help you find financial freedom today.

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