What the heck is your credit score?
Your credit score is a number that essentially tells banks and lenders like us how likely you are to pay them (us) back.
You can think of your credit score like a risk rating.
The lower your score, the riskier you seem as a borrower. On the other hand, if your credit score is high, it’s a sign that you have good financial habits and lending you money is less of a risky move.
How is your credit score calculated?
Credit reporting agencies in Australia gather information about your financial habits from banks, lenders, and even your electricity and phone plan providers. For example, if you’ve taken out a credit card, whether you’ve paid your bills on time and how frequently you’ve applied for credit.
Your MONEYME Credit Score is based on data from Equifax, Australia’s leading credit reporting bureau.
When do banks and lenders use your credit score?
Typically, any time you apply for a loan or another form of credit, your score is used to determine things like:
Whether to lend you money or not
How much money to lend you
What type of interest rate or fees apply on your loan
The bottom line? A good score will boost your chances of being approved and help you get a better deal.