Thinking about buying a home in 2025? Before you start house hunting, there’s one important number you should be paying close attention to—your credit score.
This three-digit number can make a big difference when it comes to getting approved for a mortgage, how much you can borrow, and even the interest rate you're offered. Here’s what you need to know about credit scores and how they impact your home loan journey.
What is a Credit Score?
In Australia, your credit score (or credit rating) is a number between 0 and 1,200 that reflects how reliable you are at repaying debt. Lenders use this number to assess the risk of lending you money.
A higher score generally means you’re considered a lower-risk borrower. Each credit reporting agency (like Equifax or illion) may use slightly different scoring ranges, but the general idea is the same:
Excellent: 800+
Very Good: 700–799
Good: 600–699
Average: 500–599
Below Average: <500
How Credit Scores Affect Your Home Loan
Your credit score can influence your home loan in a few major ways:
Approval Odds
Lenders want to see a history of responsible borrowing. A higher credit score makes it easier to get approved for a mortgage. If your score is low, some lenders may decline your application or require a guarantor.
Interest Rates
Some lenders offer better interest rates to borrowers with strong credit. Even a 0.25% difference in rate can add up to thousands of dollars over the life of your loan.
Loan Amounts
A better credit score may increase your borrowing capacity, as it gives lenders confidence in your ability to manage higher repayments.
Loan Features
A good credit score can also open up access to loans with more flexibility—like offset accounts, interest-only periods, or the ability to borrow with a smaller deposit.
What Affects Your Credit Score?
Several factors can help or hurt your score:
✅ Paying bills and loans on time
✅ Maintaining low credit card balances
✅ Minimising credit applications
❌ Missing payments or defaulting on loans
❌ Too many loan or credit card applications in a short period
❌ Bankruptcy or court judgments
How to Improve Your Credit Score Before Applying
If you’re thinking of applying for a home loan in the next 6–12 months, take these steps now:
Check your credit report – You’re entitled to one free copy a year from each credit bureau.
Clear any defaults – If you’ve had issues in the past, consider repaying overdue debts.
Reduce credit card limits – Even if you don’t use them, high limits can reduce your borrowing power.
Avoid unnecessary credit applications – Too many ‘hard checks’ can lower your score.
Talk to a Broker Who Understands
At Gardian Finance, we help clients across Mackay and the Whitsundays understand their credit position and get home loan-ready. If you’re unsure about where you stand or how to improve your credit profile, we’re here to help.
Let’s build your borrowing strategy—credit score and all.
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Call us: (07) 4953 2799
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Visit: www.gardian.com.au📍
Find us at: 73 Wood St, Mackay
