How to check my credit score for free?

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How cool will it be if you can become a financially savvy Aussie who uses credit scores so cleverly that your numbers are always spot-on to satisfy lenders’ credit criteria? Sounds like a perfect dream, right? Then let’s do it! Let’s turn it into reality!

In this article, find out how to check your credit score in minutes for free anytime, anywhere, and of course, without negatively affecting  your credit score.

What are the steps to check my credit score for free?

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You can check your credit score for free through several reliable online providers, including WeMoney. Simply put, checking your credit score involves the following three simple, hassle-free steps:
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• Verify your identity using your passport, driver's license number, or medicare card.

• Provide valid personal details such as your name, date of birth, and residential address (Suppose you have lived there for less than three years, you may also need to provide previous home addresses too).

• If all the information has been entered correctly, you will get your score in just minutes, conveniently on the WeMoney app as well (or on whichever trustable app/web you prefer).
  

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How to understand and check my comprehensive credit report for free?

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Again, with many of Australia's authorised online providers, requesting a copy of your comprehensive credit report is not a tough shell to crack. But following the detailed list below requires careful understanding about what to look at in your credit account, why you need that information, how it can benefit you, when to apply for a loan, which interest rate serves your best bet, and much more.

Track - a full record monitoring of your credit histories such as your personal details, as well as financial information, including any credit or loan products you’ve had, your repayment history, applications for credit or loans, and information about any bankruptcies, defaults, or court judgments in your name. Plus, you can get your monthly scores updates to help you manage your credit reputation.

Learn - how to manage and improve your score. For example, identify what factors are affecting your credit score and rating. It could be due to payment history, amount of debt, also known as your credit utilisation ratio, age of credit accounts or history, and mix of credit accounts. Plus, some providers also give a full breakdown of the score for each of these 5 factors so that you can pay specialised attention to that particular area that needs improvement. In this way, you can learn, understand, identify, and improve your score!

It doesn't stop there…...

Compare - various financial products/offers for your score. Use your credit score to see if you can find better deals. Search and compare credit cards, personal loans, and home loans. For example, with some providers, you can also view what tailored deals are available out there to match your score. Likewise desirable options like getting relevant product offers based on your credit score and profile information could help you save a lot of money.

WeMoney, for instance, has partnered with one of Australian’s leading personal loan providers, NOW Finance, to bring you competitive offers on personal loans with no fees attached. You can even get a rate quote without impacting your credit file. To learn more please follow this affiliate link here.

Note: Lenders have their internal credit score yardstick that you need to be mindful of to pass their credit standards.

Achieve - your financial goals. For example, get the tools and resources to plan how you can build your credit confidence, money management goal setting and improve your financial well-being to reach your financial goals even sooner. Don’t worry, you can use our handy WeMoney 2021 financial goal planner here that helps you to do exactly that.

Safeguard - your good credit performance and reputation. Receive alerts whenever there are changes to your credit file so that you can safeguard it against identity theft and fraud.

Which credit score should I check and what it means?

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There are three main credit bureaus in Australia: Equifax, Experian, and Illion.  And although each of them calculates their scores differently, you will still have to provide identification information to check your credit score or to get a copy of your credit report (steps to apply for a free credit check are exactly the same as mentioned above).

Now, which credit score should I aim for? Always remember that lenders use credit scores like a sacred bible to assess your creditworthiness. Generally, it is a way for lenders and credit providers to take comfort of your ability to repay the loan or credit product. That's right! So, this three or four digit number is the powerful deal breaker between you being able to get a loan or not!

As such, in Australia, your scores will be calculated somewhere on the scale between Zero and 1,000 or 1,200. Zero means poor, 1,000, or 1,200 (also known as perfect score) means excellent.

But that’s just the tip of the iceberg! The first big note to catch here is, most lenders don’t publish their credit criteria externally. As a result, the minimum credit score required for a home loan can differ depending on who you apply with. Despite this to consider, take a look at the following score range for each credit body to understand what they mean, and then compare them to your credit score to determine where you stand.

Experian: The overall range is 0-1000 where 0-509 is low, 510-621 is fair, 622-725 is average, 726-832 is very good, and 833-1200 is excellent.

Equifax: The overall range is 0-1200 where 0-549 is low, 550-624 is fair, 625-699 is average, 700-799 is very good, and 800-1000 is excellent.

Illion: The overall range is 0-1000 where 0-299 is low, 300-499 is fair, 500-699 is average, 700-799 is very good, and 800-1000 is excellent.

Nevertheless, it’s rarer to see scores higher than 900 or lower than 200, not saying it’s impossible to get over 900. Typically if score is high and you're paying a high interest rate with your current partner, you might be able to do better. Consider if NOW Finance can help you with a fuss-free personal loan with rates from 6.95% (6.95% Comparison Rate*) for individuals with Excellent Credit. And, in most cases, you’ll receive a decision on the same day if you apply before 2 pm AEDT time. How cool is that? If you’re interested to learn more, use the affiliate link again here to get a free rate quote (getting a quote doesn't impact your credit score).

Bonus takeaways:

You’re also entitled to a free copy of your credit reports every 12 months from each of these three bureaus by visiting www.oaic.com.au.

How to ensure my credit report is up-to-date?

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When checking your credit report, it’s extremely important to make sure all your personal information, such as your name and addresses, is up to date + no wrong or incorrect information on your profile. Besides that, check whether the account balances, credit limits, and payment history are also correctly presented. For instance, is there account information listed that you don’t believe is yours?

When you get your credit report, proof-read over and over about whether:

• all the loans and debts listed are yours

• details such as your name and birth date are correct (super important to prevent careless defaults on your profile).
  

If something is wrong or out of date, you can always contact the credit reporting agency and ask them to fix it. This is a free service in Australia. For example, at Equifax, you can create a my Equifax account to file a dispute. Visit the dispute page to learn other ways you can submit a dispute.

Note: some credit reporting agencies may try to charge you to get all negative information removed from your credit report. The only thing you can ask them to remove is false information. And the good news is, you can do that yourself — see credit repair.

Does checking my credit score negatively impact my rating?

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Many people are afraid to request a copy of their credit reports – or check their credit scores – out of fear that it may hurt their credit scores.

The good news is: Credit scores aren't impacted by checking your own credit reports or credit scores. In fact, regularly checking your credit reports and credit scores is an important way to ensure your personal and account information is correct, and may help detect signs of potential identity theft such as credit infringement.

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So, what are the impacts of soft and hard inquiries on credit scores? And, do they affect credit scores?

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Let’s start with soft inquiries first.

When you request a copy of your credit report or check credit scores for, say, pre-qualified credit card offers, pre-qualified loans or insurance offers, or background checks by potential employers, that’s known as a “soft” inquiry. Other types of soft inquiries result from companies that send you promotional credit card offers and existing lending account reviews by companies with whom you have an account.

Note that soft inquiries do not affect credit score, but appear as a "File Access Note" on your credit report.

How about the hard inquiry?

The “hard” inquiry, on the other hand, occurs after you have applied for a loan or a credit card and the potential lender reviews your credit history.

So yes, hard inquiries can impact your credit scores when they are conducted. Making excessive enquiries can impact your credit file, and if make too many of them, can quickly add up and make a dent in your credit score.

And examples of hard inquiries are when making a large purchase - such as:

• buying/renovating/building a house, or

• securing a mortgage like applying for a car, student or personal loan, and

• shopping around for the most competitive rates.
  

And, these inquiries require your express authorisation and consent, which is usually included in your application.

Closing facts: top 10 credit file myths busted

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We’ve worked on all the factors you need to be aware of when checking your credit score for free. For example, listed below are a few common myths debunked about your credit file.

• Myth: Only credit reporting bureaus are responsible for my credit being approved or declined. Reality: All factors including your employment, assets and liabilities, spending behaviour including your credit history impact your chances of being approved.

• Myth: Checking my credit file too often will affect my score. Realty: You can check your credit score regularly and it wont have an impact on your credit file.

• Myth: Carrying a balance on my credit card boosts my credit score. Reality: Each person is unique and by simply carrying a balance may not lead to a higher score.

• Myth: The more credit I have applied for, the better my score. Reality: This could be very wrong, making excessive requirements could lead to much lower score as lenders may see you as been desperate to obtain credit.

• Myth: If I meet all my repayments, I don’t need to check my credit score. Reality: Checking you score even if you make perfect on time repayments.

• Myth: I know I have defaults, so I have stopped even trying to apply for credit. Reality: You can still apply for credit, however the changes of being approved by mainstream lenders may will most likely go down quite considerably.

• Myth: The more loans I have the better my score. Reality: Your score is your own and personalised to you, there could be many factors to consider and not just the number of loans you have.

• Myth: I can’t get an idea about how much I can borrow without submitting an application. Reality: You can ask the lender or credit provider questions about your eligibility before you apply

• Myth: Student loans don’t affect my credit score. Reality: All types of credit can impact your credit score and credit file.

• Myth: I don’t need to worry about my credit score until I’m older. Reality: You have your credit file when you turn 18+ and for the rest of of life, it's never too late to check!

Also, watch our Founder Dan Jovevski On Channel9 News Busting Myths about Credit Scores here. For more information, check out everything you need to know about how to restore, maintain and/or improve your credit score here.

Do what now? Get your free credit score check and improve your financial health

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Download our app

Banks and lenders that you have relationships with know your credit score, so why shouldn’t you? Try WeMoney app to find out your credit score for free online anytime any day at your convenience. It also provides you with updates each month where you can track and monitor any changes with extra features like credit accounts/relationships, easy to understand insights, repayment on time, credit inquiries, and negative events. You can also add important repayment dates to our calendar to avoid late payments and dues.

Considering a personal loan or debt consolidation?

As mentioned earlier, we've recently partnered with award winning Australian based NOW FINANCE, Australia's leading go-to personal loan provider to help our members improve their financial wellness.

WeMoney members can get a free rate quote and enjoy rates as low as low as 6.95% (6.95% Comparison Rate*) for excellent credit. If you are keen to explore, get your personalised quote now.

Listen to our Podcast

To learn more about credit scores, take a listen to Episode 3 of We Talk Cents. Your hosts Dan & Blaize dive into what a credit score is, why it’s important and what factors impact your score for better or for worse. To take a listen check out the link here.

Read our latest featured articles

WeMoney was recently featured in 6PR 882 News Talk, check out the full podcast on how you can revive your credit score here.

We’d love to hear your thoughts

Also, If you enjoy using our app, please take a moment to rate it in the App Store. Your feedback in the past has tremendously helped WeMoney become the better version of yesterday. Massive thanks to each one of you for making that happen!  And now, we need your most genuine support in making WeMoney the best version of the future - 2021!

Outside resource

You’re also entitled to a free copy of your credit reports every 12 months from each of the three nationwide credit bureaus in Australia, visit Moneysmart.gov.au for more information.

Disclaimer: The author is not a financial advisor and the information provided is general in nature and was prepared for information purposes only. This article should not be considered to constitute financial advice. Accordingly, reliance should not be placed on this article as the basis for making an investment, financial or other decision. This information does not take into account your investment objectives, particular needs or financial situation.

Things you should know

Applications for finance are subject to Now Finance’s lending and approval criteria. Terms and conditions may apply. No establishment, account keeping or early repayment fees will apply to all new personal loans. Charges such as default or enforcement costs may apply if you do not comply with the terms of your loan. Settlement times may vary depending on individual circumstances. Loan repayment terms range between 18 months to 7 years with interest rates ranging from 6.95% p.a. (6.95% p.a. comparison rate*) to 17.95% p.a. (17.95% p.a. comparison rate*).

About Comparison Rates

The Comparison Rate is designed to help you understand the overall cost of the personal loan. It combines the amount of the loan, loan term, repayment frequency, interest rate, fees and charges into a single rate to show the total true cost of the loan. The comparison rates for the Now Finance loans are based on a loan of $30,000 over 5 years.

Thanks for reading this blog! Now that you’ve gathered deep insights about checking your score for free, it’s time to shine like a pro at managing your score perfectly!