Credit health in shape? Time to check?


Thinking of taking out a personal loan, or perhaps a mortgage? Then it’s a good idea to stay on top of your credit score.

If you haven’t checked your credit score in a while, or would like to give it a healthy boost, here are some things to consider.

Why is your credit score so important?

As a consumer, if you ever apply for a loan (like for a house or a car), your credit score will play a key role. It’s one of the key factors that lenders take into account when assessing your suitability for a loan.

Generally speaking, this number shows how good you are at repaying debt. And the higher your credit score, the more likely you are to have your application accepted, and get cost-effective interest rates on new loans or lines of credit. Of course, it’s not the only factor lenders look at – but it’s a crucial one, nonetheless.

How it’s calculated

Wondering what makes up your credit score? Your credit score is based on your credit history, and there are a number of things that can determine it: for example, whether you pay your bills on time, how often you apply for credit, if you (or your partner or flatmate that you share bills with) default on a payment, etc.

Checking your credit score

To have a more detailed understanding of your credit picture and what lenders can see, you may want to have a look at your credit history. This lists all your transactions, including all missed payments, defaults, mortgage repayments, etc.

So, how’s your credit score looking? If you haven’t checked your score in a while, you can request a copy of your credit report from any of the three credit reporting agencies in New Zealand: Equifax (with a score range between 0 and 1,000), Illion (0-1,000) or Centrix (0-1,500).

Or, you can get instant access to your credit report through this handy online tool from Credit Simple. A score above 500 is considered to be good, and most people score between 500-700.

Steps to boosting your score

Once you know your credit score, you can start improving it by understanding what makes it go up or down. Some steps to help you boost your credit score are:

  • Aiming to demonstrate good, long-term financial behaviour.
  • Paying your bills on time, whether mobile bills or your mortgage repayments.
  • Prioritising paying off your debt (and if you’ve just paid off a debt, avoid taking on any more for as long as you can).
  • Keeping an eye on your credit report (look for any errors).
  • Avoiding relying on other people to pay bills with your name on them (like a flatmate).
  • If you’re able to stay on top of a debt, then taking on new debt may boost your score (as long as you can manage it well). However, this is a simplified example, so get in touch with us to learn more.

Like some advice?

If you have any property plans on your mind, we can help you understand your mortgage options and how to get there. Feel free to get in touch with us anytime.

Disclaimer: Please note that the content provided in this article is intended as an overview and as general information only. While care is taken to ensure accuracy and reliability, the information provided is subject to continuous change and may not reflect current development or address your situation. Before making any decisions based on the information provided in this article, please use your discretion and seek independent guidance.