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How does your credit file affect borrowing?

Orica Financial Services Feature Article

How does your credit score affect borrowing?

Lenders use your credit score (or credit rating) to decide whether to give you credit or lend you money. Knowing this can help you negotiate better deals or understand why a lender rejected you.

Your credit score is based on personal and financial information about you that’s kept in your credit report.

This article explains everything you need to know about your credit file and how it can affect borrowing money now or in the future:

How does your credit file affect borrowing?

How your credit score is calculated

Your credit score is calculated based on what’s in your credit report. For example:

  • the amount of money you’ve borrowed
  • the number of credit applications you’ve made
  • whether you pay on time
  • Depending on the credit reporting agency, your score will be between zero and either 1,000 or 1,200.

A higher score means the lender will consider you less risky. This could mean getting a better deal and saving money. A lower score will affect your ability to get a loan or credit.

What’s in a credit report

Your credit report is a record of your credit history. It includes things like your credit rating, the credit products you hold, and your repayment history. Credit providers look at your credit history to decide whether to give you credit or lend you money. Your credit report includes the following information.

Personal information

Personal details to identify you. Like your name, gender, date of birth, driver’s licence number, employer, current and previous address.

Credit rating

The ‘band’ your credit score sits in (for example, low, fair, good, very good, excellent). Your report may also include your credit score (not all credit reporting agencies do this).

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Credit Products

For each credit product you’ve held in the last two years:

  • type of credit product (such as credit card, store card, home loan, personal loan, business loan)
  • credit provider
  • credit limit
  • opening and closing dates of the account
  • joint applicant’s name, if any 

Repayment history

For each credit product you’ve held in the last two years:

  • repayment amount
  • when payments were due
  • how often you paid and if you paid by the due date
  • missed payments (not made within 14 days of the due date), and if and when you made them

Financial hardship information

Things can happen that affect your ability to make your repayments. For example, a natural disaster, illness, job loss or relationship breakdown.

If this happens, you can ask your lender or provider for a ‘financial hardship arrangement’. This may be temporary, like deferring a payment, or permanent, like varying a loan. 

A hardship arrangement helps to protect your credit rating. Lenders like to see that you’ve made a plan to get back on track.

A hardship arrangement for a credit product, like a loan or credit card, can appear on your credit report. Your credit report will only show the months the arrangement is in place. Or, if the arrangement is permanent, the month the loan is varied. No other details are included, and the listing is deleted after 12 months.

An arrangement with a buy now pay later, phone, internet or utility provider won’t appear on your credit report.

Defaults on utility bills, credit cards and loans

Your service provider may report your non-payment of a debt (called a ‘default’) to a credit reporting agency. They must notify you before they do so.

This may include defaults on your utility and phone bills.

A service provider can report a default if:

  • the amount owed is $150 or more, and
  • your service provider can’t contact you (called a clearout), and
  • 60 days or more have passed since the due date, and
  • the service provider has asked you to pay the debt either by phone or in writing

A default stays on your credit report for:

  • five years
  • seven years in the case of a clearout

If you pay the debt, your credit report will still list the default, but it will also show that you’ve paid it.

Credit applications

If you’ve applied for credit before:

  • number of applications you’ve made
  • total amount of credit you’ve borrowed
  • any loans you’ve guaranteed

Bankruptcy and debt agreements

Any bankruptcies or debt agreements, court judgments, or personal insolvency agreements in your name.

Credit report requests

Any requests for your credit report that have been made by credit providers.

Can you fix mistakes in your credit report

When you get your credit report, check that:

  • all the loans and debts listed are yours
  • details such as your name and date of birth are correct

If something is wrong or out of date, contact the credit reporting agency and ask them to fix it. This is a free service or contact Orica Financial Services for more information.

How does your credit file affect borrowing?

See how much you could save in repayments every month with our Debt Consolidation Calculator. 

How does your credit file affect borrowing?

See how much you could save in repayments every month with our Debt Consolidation Calculator. 

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How does your credit file affect borrowing?
How does your credit file affect borrowing?
How does your credit file affect borrowing?

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How does your credit file affect borrowing?
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Frequently asked Questions

How does your credit file affect borrowing?

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Here at Orica Financial Services, we are different from other brokers because we look at every positive aspect of your loan application before we make a recommendation on how you should move forward with your loan application.

There is no need to guess, call as at Orica today and we will help you with your loan application.

Lenders we work with

We have access to one of Australia’s largest lending panels, which means choice from over 60+ lenders and thousands of different loan options. 

How does your credit file affect borrowing?
How does your credit file affect borrowing?
How does your credit file affect borrowing?
How does your credit file affect borrowing?
How does your credit file affect borrowing?
How does your credit file affect borrowing?
How does your credit file affect borrowing?
How does your credit file affect borrowing?
How does your credit file affect borrowing?
How does your credit file affect borrowing?
How does your credit file affect borrowing?
How does your credit file affect borrowing?
How does your credit file affect borrowing?
How does your credit file affect borrowing?
How does your credit file affect borrowing?
How does your credit file affect borrowing?
How does your credit file affect borrowing?
How does your credit file affect borrowing?
How does your credit file affect borrowing?
How does your credit file affect borrowing?

Lenders we work with

We have access to one of Australia’s largest lending panels, which means choice from over 60+ lenders and thousands of different loan options. 

How does your credit file affect borrowing?

Non Conforming Loans

Good for getting you out of trouble, consolidating debt and lowering your monthly repayments

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Please note that lending policy, fees & charges apply

How does your credit file affect borrowing?

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How does your credit file affect borrowing?

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