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Your credit file and associated credit score are critical factors considered by credit providers when you want to borrower money and help lenders determine whether you can borrow, how much you can borrow, and at what rates.

Your credit score is a number calculated from information in your credit report at a point in time.

In Australia, a credit score is used by creditors like banks and utility companies to determine your suitability for credit and the level of risk associated with providing you credit.

AFS utilises the credit reporting body known as Equifax Pty Ltd ("Equifax") - formerly known as Veda Advantage Limited - to review information contained on your credit report and your credit score.

We access your credit file to confirm the information you have told us and to assess your suitability for a loan. Whilst we utilise the Equifax information, it only forms part of our credit assessment process.


Equifax provides credit reporting, credit scoring and data analytics services to the credit industry in return for a fee.

AFS is likely to provide your personal information to Veda in order to assess your credit worthiness.

A credit report is a detailed report of an individual's credit history. Credit bureaus collect information and create credit reports based on that information, and lenders, like AFS, use the reports along with other details to determine loan applicants' credit worthiness.

Credit reports may contain details about your current credit accounts – such as the type of credit and the credit limit – and also information about credit applications that you have made. Your credit report will also contain certain other information about you, including whether you are, or have been, bankrupt or had court judgements against you, or whether you have had a credit account where you defaulted on your repayments.

Your credit report also contains your name and other identifying information (like date of birth, address, driver’s licence number and current employer).

Generally, when you apply for credit, the credit provider may use the information in your credit report to help work out whether you can afford to repay the loan and whether you are likely to repay it.

The Privacy Act sets out the rules about what can be in your credit report and how it can be accessed and used.

It is easy to order your personal credit report online from an independent credit bureau, such as Equifax. For further details go to:

What is my credit score?

Your credit score or rating, is published as part of your credit report.
Equifax call their credit score the Masterscale score. It is generally a number between -200 and +1200 which is an indicator of your credit worthiness relative to other loan applicants.
A lower credit score from a credit reporting body or credit provider compared with a higher credit score from the same entity means that you are regarded by them as a higher credit risk than a person who gets a higher credit score.

When you request a copy of your credit report, it will contain your credit score.

You may have many different credit scores – because each credit reporting body or credit provider will calculate their own score using their own formulas and information available to them at that time. They may hold different information and potentially assess this in different ways.

Your credit score from a credit provider with whom you have a limited credit relationship could be quite different to your credit score from a credit provider with whom you have many credit products.

It’s also important to know that your credit scores keep changing over time, as each credit provider and each credit reporting body obtains more up to date information about you or changes their formula for calculating your score.

Unfortunately, this means that the Equifax masterscale score on your credit report is only an indicator of your credit worthiness.

A payment default may be recorded on your credit report if you don’t pay a bill or loan payment of $150 or more for at least 60 days after it is due.

The payment default can only be listed with the credit reporting body if:

  1. the credit provider notified you (at or before the time you entered into the credit agreement) that credit information would be given to a credit reporting body
  2. you were overdue in making a bill or loan payment
  3. the credit provider issued you a written notice to recover the payment
  4. the credit provider informed you that it intends to list a payment default on your credit report at the time it asked you to make the overdue payment
  5. the credit provider issued a second written notice providing you with one final opportunity to pay, and advising you that, within a period of at least 14 days but no more than three months, it will disclose to a credit reporting body that you are in default
  6. on the date that the credit provider discloses to the credit reporting body that you are in default , the bill or loan payment is at least 60 days overdue.

However, if you are in financial difficulty and have requested hardship assistance from your credit provider, they may not list your default during the period that they are considering your request for hardship assistance.

Once a default is added to your credit report, it will remain there for five years, even after you pay back the money. However, if you have paid the default amount, it must be noted on your credit report that the debt was paid in full.

How do I avoid having a bad credit file?

Perhaps the simplest way to maintain a healthy credit file is to pay your bills on time and ensure that you meet your loan repayments. It is also important to regularly check your credit file held by Equifax, and if any information listed there by a credit provider is incorrect, contact the relevant credit provider to seek an amendment. In the case that public record information such as bankruptcy, deed agreement, court writ or court judgement information is incorrect, write to Equifax and they will investigate and advise you of the outcome of that investigation, free of charge.

Borrowing more money when you’re already having financial troubles may only make your situation worse. If you’re finding it hard to make repayments or if you’ve lost your source of income, you should contact your credit provider right away and work them in order to preserve a default-free credit report.

Understanding more about credit reporting

Maintaining a healthy credit report is vital when it comes to securing a loan. It's important that you always provide accurate information to credit providers about your current circumstances and also take time to ensure the details you provide about your previous residential addresses and employers are accurate as well. It is also important that you protect and secure your private information to avoid being a victim of identity fraud.

Information that is out of step with previous applications and other databases such as electoral roles may deemed to be fraudulent and adversely impact your credit score. Even if you still obtain credit, you may end up paying a higher interest rate because of your lower credit score.

To understand more about credit reporting, your credit score and protecting your identity, take time to do some research. Here are some useful links: