Understanding Your Credit Report

What Is a Credit Report?

A credit report is a record of your credit history, including the various types of credit accounts you have had, your payment history, and other information like your credit limits. The information contained in your report is also summarised in the form of a ‘credit score’, which is used as an indication of how likely you are to pay back your debt. A credit score is a number between 0 and 1000 or 1200. According to Equifax’s rating system, the scores are as follows: below average (0-459), average (460-660), good (661-734), very good (735-852) and excellent (853-1200). A high credit score means that you are considered to be ‘less risky’ as a borrower, and more likely to be given loans with better terms. A low score could mean that you will have your loan applications rejected or get less favourable rates. If you have a low score, don’t panic – your credit rating is not set in stone, and can be improved over time with diligent loan repayments. You can read more about your credit score and how to improve it in this blog. 

Types of Credit Scores

When it comes to credit scores, leading groups such as Equifax use the information available on your credit file to establish your score. The score may differ from lender to lender.

Equifax uses four different scores including:

  • Comprehensive Score
  • One Score
  • Negative Data Score
  • 1.1 Score

If you are able to follow good conduct, such as repaying bills or loans on time repeatedly, you will typically receive a good score across all four areas. If you’re unsure of how well you will score, no worries – at Buddii, we will run your credit report to help find a lender that matches your credit rating score, helping you get the outcome you need when it comes to future borrowing.

What Information Is Contained in a Credit Report?

A credit report contains all sorts of personal, public and credit provider-supplied information. If you have ever had a credit card, personal/home loan, mobile phone plan or electricity/gas account, it is quite likely that you have a credit report. A credit report contains all sorts of information, including:

  • Personal information: full name, date of birth, driver’s licence details, gender, residential addresses and employer information.
  • Consumer credit information: credit applications you have made, credit account information, monthly repayment history, details of overdue debts and payment defaults
  • Public record information: court judgements, directorship details, proprietorship details, bankruptcy details, debt agreements and personal insolvency information
  • Commercial credit information: credit applications for commercial purposes, details of overdue commercial credit accounts

Who Can Access Your Credit Report?

A credit provider (like a bank, licensed finance company or utility provider) can ask for a credit report to support your application for a new loan or service contract. Your credit report is an opportunity for you to show lenders how you manage existing debts, and will be used as a guide of how reliable you will be as a debtor. Your credit report can’t be accessed by real estate agents, landlords, employers, foreign credit providers, foreign credit reporting bodies or insurance companies (other than mortgage insurers and trade insurers). Your credit report includes a log of who has accessed it, so you can have a look and see which organisations have been accessing your information. 

You Can Access Your Credit Report

In Australia, everyone can access a free copy of their credit report every 3 months, from one of the main credit reporting bodies (Equifax, Experian and Illion). Checking your credit report regularly gives you the opportunity to see your credit score, identify any mistakes and request to have them fixed, and identify identity theft (i.e. fraudulent credit activity that takes place in your name). To access your report, just head to the website of one of the credit reporting bodies we mentioned above. You will need to prove your identity using official documents like your driver’s licence, passport and Medicare card, and then you will be able to download your report free of charge. 

Have a Question About Your Credit Report?

If you have any questions about your credit report or your credit score, don’t hesitate to get in touch. At Buddii, we are a national team of experienced finance brokers that work with a range of Australia’s lenders and loan products. We can help you to find a loan that meets your needs and suits your lifestyle.