What is a credit score?

(not to be confused with loanScore) A lender uses a credit score to determine a borrower’s risk profile. In Australia this is made up of two numbers:

  • one from an individual’s credit file,
  • the other from the lender itself determining how well the applicant meets their lending criteria.

How is my credit score calculated?

All the information about your credit history is available in your credit file. This information is analysed using the Equifax Credit Score – a model that predicts the risk a lender would take in lending you money. Once you submit an application for a home loan, the lender will request your credit file. They use its rating to calculate your overall credit score alongside other key details from your application:

  • income,
  • assets,
  • living costs, and
  • outstanding debts.

What is considered a good credit score?

Most lenders will not allow you to see the credit score that they give you; they will only advise you on the outcome of your application. However, you are able to access the credit score from your credit file. This ranges from 0 to 1200. Higher scores indicate lower credit risk. A score of 700 and above is considered ‘good’.

What type of information does my credit file contain?

Your credit file contains information from credit providers and the public record. It will include:

  • Personal identifying information;
  • Repayment histories on credit cards, loan and mortgages;
  • Types of credit you already have;
  • Number of credit enquiries in last 12 months;
  • Default information. When you request your credit score, you will also receive details on what factors have influenced your rating. This information may enable you to improve your score over time.

How can I check my credit file?

In Australia, you can access your credit file for free once a year by contacting one of the following Credit Reporting Bodies (CRBs):

How can I raise my credit score?

You can improve your credit score with good financial management:

  • Pay all your bills on time;
  • Settle any defaults;
  • Avoid applying for credit you don’t need;
  • Be wary of applying for credit with less reputable lenders (this may indicate financial distress and negatively impact your rating). Managing your finances well before you apply for credit will increase your chances of getting approved.

How do lenders calculate my credit score?

Your credit score from your credit file will remain the same – at a point in time – regardless of which lender you choose to apply for a home loan with. However, your overall credit score will vary from lender to lender. Lenders calculate this score not only by the information on your credit file, but also on the information you provide in your application. Each lender has a different method of determining this score – so some may assess you more favourably than others. An uno adviser can look at your personal circumstances and advise you on which lenders are more likely to approve your application. This can help you avoid having your application rejected and protect your credit file from the negative effects this could have on it.

What results might I get?

A lender takes information from your application and credit file and uses their own algorithms to calculate your credit score. They will base their decision on this computer-generated result, which could be:

  • Pass – your credit score is good and you should be able to secure a home loan.
  • Decline – your credit score is lower than it needs to be, so lenders will decline your application on the spot.
  • Refer – the computer was unable to calculate your credit score, either:
  • The information you provided was incomplete, or
  • Your credit score is stuck between a pass and a fail. If your application receives a referral, there’s still a possibility of getting your home loan application approved. It will be forwarded to a credit manager to assess it manually.

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What our customers are saying

Gabe Windsor
October 26, 2023
What a fantastic experience using UNO Home Loans. Mike Parsons and the team were exceptional. Such an easy, hassle free experience, cannot recommend them highly enough. Mike Parsons was in touch every step of the way, and with him doing all the leg work, the transition to a refinanced home loan was a very easy one. Thank you!
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Laurisa Sticotti
July 1, 2023
Scott Wilkinson has been fantastic when dealing with my broking needs. He has held my hand through every step of the way and has made purchasing my first home a much more comfortable experience than I anticipated.
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Thusi Gamage
July 1, 2023
Awesome team, Very reliable and friendly. Scott Wilkinson is very experienced and knowledgeable.He guided us throughout the process and was available to help.
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Omar Zazou
June 1, 2023
I have worked with Scott Wilkinson to get my home loan and he has been a massive help to navigate my first home purchase. He has taken care of all the financial details and I didn't need to worry about anything. Highly recommend him for his professionalism, patience and support!
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Kelly O'Connor
June 1, 2023
You won’t find any broker better than Anita at UNO. We’ve told all our friends and family about her and will be using her for all our mortgages in the future! A stress free process from the start. She listened to our needs and was always available.
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Ashley Morson
We are truly grateful for uno home loans and our broker Karis Churchill. This is our second time purchasing a home with the help from Uno and both times have been a very positive experience. Our recent purchase had many obstacles due to different factors however it was our dream home and we were up for the challenge. Our broker Karis was a true support and went above and beyond. She communicated so well with our solicitor and the real estate agents. She kept us updated through every step and kept us motivated when things seemed impossible. Uno is very fortunate to have Karis as a broker and we would highly recommend her to anyone. Our family are so happy we are now in our new forever home. Thank you so much Karis and to the uno team!!!
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Ebubekir Demir
Thank you Eren for your quick and efficient turn around time to getting an approval for a loan. Will be recommending you to anyone that needs a quick and reliable loan.
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