What is a credit score in Australia?

Three bureaus, three scales

Australia has three credit reporting bodies: Equifax, Experian and illion.

Each holds its own file on you, built from what lenders have reported to it — and not every lender reports to all three. Each calculates its own score, on its own scale:

A number from one bureau cannot be compared with a number from another. A score of 700 means something different in each. Check the current scale on the bureau's own site, since these have changed before.

What lenders actually use

Lenders do not simply read the score a bureau shows you. They obtain your credit report and run their own assessment over it, alongside your income, expenses and their own lending criteria at that moment.

Responsible lending obligations require credit providers to assess whether a loan is suitable and affordable for you, which means your income and expenses matter as much as your credit history — and neither appears in your score.

So a high score does not guarantee approval, and a moderate one does not preclude it.

Comprehensive credit reporting

This is the significant Australian development, and it changed what a credit report contains.

Under comprehensive credit reporting, lenders report positive information as well as negative: the accounts you hold, their limits, when they were opened, and a month-by-month repayment history showing whether each payment was made on time.

Two consequences:

• Consistent on-time payments now help you actively. Under the old regime, a clean file mostly meant an absence of bad news.
• Late payments are visible sooner. Repayment history information records payments as late once they are more than a set number of days overdue, well before anything reaches the threshold to be recorded as a default.

Only licensed credit providers may report and access repayment history information.

What is on your credit report

• Identifying details — name, date of birth, addresses, driver's licence number, employer.
• Consumer credit liability information — each credit account, its provider, type, limit, and open and close dates.
• Repayment history information — a month-by-month record for each account.
• Credit enquiries — every application you have made, with the amount and the provider.
• Defaults — overdue amounts above the reporting threshold, unpaid for a set period after the required notices.
• Serious credit infringements, court judgments, and personal insolvency information.

How long things stay

Retention periods are set by the Privacy Act. Broadly:

Check the current periods with the OAIC, which publishes the authoritative position, before assuming something should have dropped off.

Getting your report

You are entitled to a free copy of your credit report from each credit reporting body at regular intervals, and additionally if you have been refused credit or have had a correction made. Each bureau must provide it — you do not have to pay, and you do not have to sign up to a subscription to get it.

Request it from all three. An error on one file will not appear on the others, and a lender may only be pulling one of them.