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What is an Equifax score?

Posted: Wed Feb 13, 2019 3:41 pm
by Jaxon
Hi, while doing some research into buying our first home, we’ve been told that Equifax scores are kind of important for getting approved for home loans. What’s considered a good Equifax score?

Re: What is an Equifax score?

Posted: Wed Feb 13, 2019 5:13 pm
by Otto Dargan
Hello Jaxon. Welcome to the forums.

The Equifax credit score (previously known as Veda score) is a score on your credit file which compares you as a borrower to the rest of the Australian population. It is one of the factors lenders consider when they assess your home loan application.

Generally, a score is considered:
  • Excellent: If it's above 700.
  • Good: If it’s between 600 to 700.
  • Average: If it is 550.
  • Bad: If it’s between 400 to 500.
  • Very bad: If it’s any score below 400.

One of our experienced mortgage brokers can help you better understand how your Equifax score and credit file can affect your chances at home loan approval.

Please give us a call on 1300 889 743 or fill in our free assessment form today.

Cheers

Re: What is an Equifax score?

Posted: Wed Feb 13, 2019 6:17 pm
by Jaxon
I requested our Equifax credit score and it looks like my credit score is 520 while my wife's score is 590. Looks like I’m slightly below average and my wife’s Equifax score is slightly above average. How do they actually calculate our scores?

Re: What is an Equifax score?

Posted: Wed Feb 13, 2019 7:23 pm
by Otto Dargan
Hi Jaxon,

Equifax calculates your score based on all the details of your credit file, which includes:

  • Personal information: This includes your full name, D.O.B, gender, address, previous address, driver’s license number, employer and previous employer.
  • Types of previous credit provider: There are different types of lenders, for example, a credit union may have a higher level of risk than a major bank or lender.
  • Nature of previous credit or loans: Home loans and HELP debts are considered lower risk than payday lending or car finance.
  • Credit enquiries: Loans that you’ve applied for in the last 5 years are listed here.
  • Defaults: Any debt where you’re more than 60 days overdue are listed here as defaults.
  • Court writs: Any formally written document that is issued by the court; usually because someone has lodged a case against you.
  • Court judgements: Judgements are listed when a suitable agreement can’t be reached between you and the creditor.
  • Bankruptcy history (including Part IX history): Declaring bankruptcy or entering into a Part 9 agreement essentially brings your score to zero.

Cheers,

Re: What is an Equifax score?

Posted: Thu Feb 14, 2019 12:48 pm
by Jaxon
Thanks for the information so far. So, how can I improve my score?

Re: What is an Equifax score?

Posted: Thu Feb 14, 2019 5:11 pm
by Otto Dargan
Hi Jaxon,

Improving your Equifax score is different from improving your credit score with a particular lender. The Equifax score is calculated based only on your credit file whereas a lender is looking at the overall aspect of your application.

There are some simple steps you can take to improve your Equifax score:

  • Ask Equifax to fix up any data that’s incorrect.
  • Avoid moving address or changing employer unnecessarily.
  • Avoid applying for credit you don’t need.
  • Avoid applying with less than reputable lenders.
  • Pay all your debts and bills on time.
  • If you have any defaults, then make sure that they are paid on time.

Let one of our experienced mortgage brokers guide you through the process of getting a home loan.

Please give us a call on 1300 889 743 or fill in our free assessment form

Cheers,