What is a credit score, and how is it calculated?

When it comes to your eligibility, your credit score plays an important role. Learn how your credit score is calculated, and how you can improve your credit score.

What is my credit score?

Your credit score is a rating provided by credit reporting bodies, based on your borrowing and repayment history. It typically represents your likelihood to pay your bills on time and a higher score indicates to lenders you’re a lower credit risk.

How is my credit score calculated?

Your credit score is calculated based on several factors in your credit report including:

• Your payment history – have you made payments on time, missed or had late payments?
• The amount of credit associated with your name – credit card, personal loans and other debts and liabilities  
• The length of your credit history
• The number of recent requests a customer has made

How can I check my credit score?

You can check and track your credit score for free with tools like Credit Savvy. Different credit reporting agencies will score in different ways and generally the number is between 0 to 1000. but the higher the number, the better your score.

How does my credit score impact my eligibility?

It’s important to have a good credit score as this will play an important role in determining whether a lender will loan you money. A good credit history indicates that you are likely to be a reliable customer into the future who consistently makes repayments on time.

If your credit history contains missed or late payments, this will impact your ability to receive approval on a home loan.  

How can I improve my credit score?

Don’t let your credit score deter you from making changes! You can improve your credit score by:

• Paying your bills on time
• Making loan repayments on time
• Reducing the amount of debt against your name

Learn more about what factors impact your borrowing power here.  

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This article is intended to provide general information only. It does not have regard to the financial situation or needs of any reader and must not be relied upon as financial product advice. Please consider seeking financial advice before making any decision based on this information.‍

Unloan is a division of Commonwealth Bank of Australia.

Applications are subject to credit approval, satisfactory security and you must have a minimum 20% equity in the property. Minimum loan amount $10,000, maximum loan amount $10,000,000, and total borrowings per customer across all Unloan loans is $10,000,000. (For purchase loans a minimum 10% equity is required - however a Lenders Mortgage Insurance (LMI) premium and higher interest rate apply. In some cases, depending on the property’s location or type, an LMI premium may also be required for LVR between 70.01% to 80%). For loans with Lenders Mortgage Insurance (LMI) the minimum loan amount is $10,000, maximum loan amount is $3,000,000 and total borrowings per customer across all Unloan loans is limited to $3,000,000).

Unloan offers a 0.01% per annum discount on the Unloan Live-In rate or Unloan Invest rate upon settlement. On each anniversary of your loan’s settlement date (or the day prior to the anniversary of your loan’s settlement date if your loan settled on 29th February and it is a leap year) the margin discount will increase by a further 0.01% per annum up to a maximum discount of 0.30% per annum. Unloan may withdraw this discount at any time. The discount is applied for each loan you have with Unloan.

*At Unloan, we do not charge any annual, application, banking, account, transaction, late or exit fees. In certain circumstances you may be required to pay a Lenders Mortgage Insurance (LMI) premium. Learn more about why this is applied and how it works. Government fees may also apply. Learn more about government fees here. Your current lender may charge an exit fee when refinancing.