How can I calculate my credit score?

You can't calculate your credit score yourself, but the good news is that it's free to check it.

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There is no mathematical formula, calculator or simulator you can use to compute your credit score, but you can learn what information determines it. You can use this guide to understand what parts of your credit history impact your score, plus request a free copy of your credit report and score through Finder.

What is a credit score?

Your credit score is a number between 0 - 1,000 if reported by Experian or illion and 0 - 1,200 if reported by Equifax. The higher the better. It's determined by a variety of personal and financial information as listed on your credit report. Your credit score effectively shows a credit issuer how risky you would be to lend money to.

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How is my credit score calculated?

From the types of credit you've applied for, to the number of enquiries you've made and your repayment history, here are some of the factors that can impact your score:

  • The type of credit provider. Lenders use different criteria to approve your credit application, so the type of credit provider listed on your file is factored in when determining your credit score. For instance, the level of risk associated with a peer-to-peer lender will differ from that of a bank.
  • Type and size of credit. Different types of credit will carry different types of risk, as will larger loan sizes and credit limits. However, secured loans such as mortgages, while larger, will be calculated differently. If you have a credit card, your credit limit will be listed on your report rather than your balance.
  • The age of your credit report. If you've only had a credit report for a short while it will be treated differently to a credit report that has been active for a number of years. A new credit file with little evidence of positive behaviour may be riskier than an older credit file.
  • Credit enquiries. Every time you apply for a loan, credit card or even interest-free finance it will be listed on your credit file. If you have multiple loan applications in a short space of time it could hurt your credit score. Your pattern of credit enquiries over time is also looked at. For instance, if you have a new credit report with multiple credit enquiries it will be treated differently to a credit report with the same number of credit enquiries spread over time.
  • Personal details. Details of your employment history, age and length of employment, and even how long you have been at your current home address, could affect the level of credit risk assigned to you.
  • Negative credit listings. Bureaus look at any serious infringements on your credit report to better understand your financial reliability and hence your credit score. Any defaults, clearouts or outstanding debts on your credit history directly impacts what your credit score will be.
  • Court writs or default judgments. Court judgments, personal insolvencies, writs and bankruptcies or other public documents on your credit file will also impact your credit score. These are considered negative marks, so they will hurt your credit score.

Getting a copy of your credit report and score does not harm your credit score or leave a mark on your file, so it's a good idea to request a copy and see where you stand. Only then will you know whether to start making improvements to lift a weaker score or to explore the options you have with a stronger one.

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