Your Credit Score – A Quick Guide

What is a credit report?

A credit report scores an individual’s credit history based on their ability to follow a lender’s conditions. It also contains information about your recent borrowing history including details of any defaults; your current borrowing position; and how often you apply for finance.

What does a credit report do?

A good or clean credit report lets a lender know that you are likely to repay your debt. It therefore makes its easier for you to borrow money.

If you have a poor credit report you will probably find it more difficult to borrow money. Finance companies protect themselves from the risk of lending to people with poor credit reports by either declining applications or imposing additional fees, usually in the form of increased interest rates. A good lender will, however, talk with you about what you need and the options available to you.

Who uses credit reports?

Any company that wants to understand your ability to repay a debt or manage money. Prospective employers often access credit reports to understand a potential employee’s ability to handle money responsibly.

How do you access your credit report?

If you want to review your credit report you can apply to one of the three providers in New Zealand, all of whom allow you to request a report online and free of charge.

The providers are: Veda; Dun and Bradstreet and Centrix.

How do I protect my credit status?

• Review your credit report regularly to ensure that all the details are correct.
• You can protect your credit status by making sure that you meet your financial commitments as agreed with your finance provider.
• Applying too often for finance can negatively impact your score, so it’s also wise to only apply for finance after you have fully investigated your options and selected your preferred provider.