Credit Score for a Home Loan in Australia: What Lenders Actually See

By Andrew Paterson

Your credit file can shape a home loan application before a lender ever looks at your payslips.

Most people only think about it after a knockback, and by then the damage is already on record. Below is what sits on an Australian credit file, how lenders read it and the habits that trip borrowers up in the months before they apply.

This is general information only. It is not financial or credit advice and it does not consider your personal situation.

What is on your Australian credit file

Credit files used to record mostly the bad news. Comprehensive Credit Reporting (CCR) changed that, and the big four banks have been legally required to report this fuller data since 2021.

A current report can include:

• Identification details such as your name, address and date of birth
• The credit accounts you hold, their limits and when they were opened or closed
• Two years of repayment history information (RHI)
• Credit applications and enquiries
• Defaults, court judgments and serious credit infringements
• Bankruptcy and debt agreement records
• Financial hardship arrangements

Buy now pay later (BNPL) has also changed. Since 10 June 2025, BNPL has been regulated as credit, so providers must hold a credit licence and run credit checks.

That means a BNPL application can now leave an enquiry on your file. Some providers also report your repayment history, while others currently do not.

Australia now has two main credit bureaus

Many older guides tell you to check three bureaus. Experian bought illion and has now folded the two databases into a single Experian report.

So the main consumer credit reporting bodies today are Equifax and Experian. If an old illion listing worried you, it now sits on your Experian file.

How repayment history is recorded

RHI is a rolling 24-month record. Each month, a credit provider can mark whether your repayment was on time.

The common markers work like this:

• 0 means the payment was up to date
• 1 to 6 show how far behind you were, in roughly 30-day steps
• X means the payment was more than six months overdue
• A or V flag a temporary or permanent hardship arrangement

A payment only counts as missed once it is more than 14 days past the due date. The lender does not have to warn you before it reports a missed payment, so set up reminders or direct debits well ahead of any application.

Why your file affects borrowing power

Your file does more than feed a score. It also tells the lender what debts you carry, which flows straight into serviceability.

If you want the full picture, our guide on how lenders calculate borrowing power walks through it step by step.

CCR shows your credit limits as well as your balances. Lenders generally assess a credit card on its full limit, even when you owe nothing, because you could draw it down tomorrow.

An unused $15,000 card can therefore reduce how much a lender will offer you. Reducing or closing limits you do not need is often worth considering before you apply, and we cover the detail in how credit card limits affect borrowing power.

Credit score ranges and what lenders look for

Scores run from zero to either 1,000 or 1,200, depending on the bureau. Equifax, which many lenders use, scores from 0 to 1200 in these bands:

Band	Equifax score
Below average	0 to 459
Average	460 to 660
Good	661 to 734
Very good	735 to 852
Excellent	853 to 1200

Experian’s scale changed when it merged with illion, so read your score against the bands shown on your own report.

No lender publishes a single pass mark. Mainstream lenders use their own scoring on top of the bureau data, and they pay close attention to defaults, judgments and recent missed payments.

A strong score helps but never guarantees approval. Your deposit, income, expenses and the overall pattern of your file all count.

Why multiple enquiries can hurt your application

Each time you apply for credit, the lender’s check is recorded on your file. That enquiry stays there for five years.

Equifax lists the number of enquiries and your shopping pattern among the factors behind its score. A cluster of applications in a short period can suggest you are under financial pressure or being declined elsewhere.

Picture the classic do-it-yourself approach. You want the best rate, so you apply at four banks in a fortnight.

That leaves four enquiries in a tight window, right before a lender assesses you for pre-approval. If you are unsure how that stage works, read our breakdown of what home loan pre-approval means first.

How a broker helps protect your file

A broker can compare lender policies against your situation before anything is lodged. The aim is to choose a lender whose criteria suit you, then submit one well-prepared application.

It is one reason so many buyers now turn to a broker rather than applying at several lenders themselves. You still get a view of the market, with far fewer marks on your file.

Defaults: what can be listed and for how long

A default is more serious than a single late payment, and strict rules apply before a lender can list one.

A consumer credit default can only be listed when:

1. The overdue amount is $150 or more
2. The payment is at least 60 days overdue
3. The provider has sent a first notice to your last known address
4. A second notice, sent at least 30 days later, warned that the default would be reported
5. At least 14 days have passed since that second notice

A listed default stays on your file for five years, even after you pay it. Paying it updates the listing to show the debt is settled, and lenders can see that change.

Serious credit infringements, such as fraud or moving without contact to avoid a debt, stay for seven years.

When a default can be removed

An accurate default cannot be removed. Be wary of any business promising otherwise, because the only thing anyone can have removed is incorrect information.

A default listed in error may come off. Look for:

• An amount under $150
• A debt that was less than 60 days overdue
• Missing or late notices
• Wrong personal details or a debt that is not yours

Correcting an error is free. Start with the credit provider or the bureau, and if that fails you can complain to the Australian Financial Complaints Authority (AFCA) at no cost.

How to check your credit file before you apply

By law, each credit reporting body must give you a free copy of your report once every three months. You can also get a free copy if you have been refused credit in the past 90 days or had information corrected.

Equifax confirms that ordering your own report will not harm your score. Moneysmart explains how to request one.

A simple checklist:

1. Order your free reports from Equifax and Experian
2. Check your personal details, addresses and account listings
3. Look for defaults, judgments or enquiries you do not recognise
4. Note your credit card and BNPL limits and decide whether you still need them
5. Confirm your recent repayments show as up to date
6. Raise any errors with the provider or bureau before you apply

Do this a few months before you plan to buy so there is time to fix problems. It fits neatly into a broader 6-month plan to get loan ready.

What a poor file can cost you

A damaged file can push you towards specialist lenders, whose rates are often well above mainstream pricing. As with comparison rates versus headline rates, the gap is easy to underestimate.

Here is an illustration. Assume a $500,000 loan over 30 years at 6.90% compared with 8.90%, a 2% difference.

• At 6.90%, repayments are about $3,293 a month
• At 8.90%, repayments are about $3,987 a month
• That is roughly $694 more each month, or about $250,000 more interest if the higher rate ran for the full term

In practice, many borrowers use a specialist loan as a stepping stone and refinance once their file improves. Even a few years at the higher rate adds up, which is why the pre-application work matters.

If you are struggling with repayments

Call your lender before an account slips into default. Since 1 July 2022, credit providers report hardship arrangements separately from missed payments.

The hardship marker drops off one year after the arrangement ends, and bureaus cannot use it to calculate your credit score. A lender also cannot list a default while it is considering your hardship request.

A lender reviewing a home loan application will still see the marker and may ask about it. Even so, an arrangement generally leaves a far lighter mark than a default.

Where to from here

Your credit file is the part of a home loan application you can work on well before you meet a lender.

Check it early and keep new applications to a minimum. Fix genuine errors, and give accurate listings time to age.

If you would like someone to review your file and situation before you apply, we are happy to help.

Credit reporting rules, score bands and lender policies change over time. Check current details with the relevant bureau, lender or regulator before acting.

Frequently asked questions

Does applying for a home loan hurt my credit score?

A credit application is recorded as an enquiry and stays on your file for five years. One application is normal. Several in a short period can weigh on your score and make lenders cautious.

Does checking my own credit report lower my score?

No. Requesting your own report does not count against you, and you can get it free from each bureau every three months.

How long do negative listings stay on my credit file?

Defaults stay for five years and serious credit infringements for seven. Missed payments drop off after two years, and hardship markers one year after the arrangement ends.

Will buy now pay later affect my home loan application?

It can. BNPL is now regulated as credit, so applications may appear as enquiries and some providers report repayments. Lenders will also count your BNPL limits and repayments as commitments.

What credit score do I need for a home loan in Australia?

There is no universal minimum. Each lender applies its own criteria, and a clean recent repayment history with no defaults usually matters more than hitting a particular number.