There are a number of things you can do to improve your credit score quickly and over a longer period of time.
You can start by consistently repaying your debts on time, paying off any missed or late payments and being careful about managing and minimising your existing debts.
However, improving your credit score is also a long-term process and it's important that you continue to take steps to ensure your score doesn't decrease over time.
9 ways to improve your score
Follow these steps and you'll increase your credit score in no time:
You can't improve your credit score if you don't know what it is and don't understand what it means.
You can check your credit score for free through Finder. It takes a couple of minutes and then you'll know exactly what your score is. You'll get a score between 0 and 1,000. The higher the better.
Along with the score you'll get your credit report, which contains:
A 24-month history of your loan repayments, including late payments or defaults.
Information about your credit accounts (loans and credit cards).
Any enquiries or requests made by lenders for your credit report in the last 5 years.
Any bankruptcies or court judgements in your name.
Once you have your credit score you can identify the best ways to increase it.
2. Correct any errors in your credit report
Look at the details contained in your credit report. If it all looks accurate, then jump to step 3. But if you find any errors you can get them corrected and your credit score should increase pretty quickly.
Here are some examples of possible errors:
Incorrect personal information
Incorrect missed payments or defaults
An unpaid debt you were never notified about
Enquiries made on your behalf for credit you never applied for
You'll need some personal identification, plus the report, the specific detail you're challenging and evidence of the error.
3. Pay off late payments and defaults
You should fix the biggest issues dragging your credit score down as soon as possible. Red marks on your credit report are usually:
Missed payments. If you've missed a payment on a bill by more than 14 days it is recorded on your credit report for 2 years.
Defaults. If a repayment is more than 60 days overdue and the amount is $150 or more, a default is recorded in your credit report. Defaults stay on your report for 5 years.
Prioritise paying off any outstanding debts, especially a default. Make sure you pay any missed payments before the 14 days if possible.
Paying off an outstanding payment looks better on your credit report but the missed payment or default is still recorded.
4. Make regular repayments on your debts
It sounds obvious but don't miss a payment on your credit card or loan. Pay off at least the minimum on your credit card before it's due.
🔥 Hot tip
Set up direct debits so payments are made automatically. Just make sure you have money in the bank account to cover the payment.
Good credit means going into debt
You might think someone who has never had a cent of debt to their name would have a perfect credit score. But that's not the case.
To prove you are a reliable borrower you need to actually have a history of managing debt responsibly.
If you've never had a loan or credit card before it can be hard to show this. So you might actually be better off applying for a credit card with your bank as a first step.
Just make sure:
You keep the credit limit low
You actually use the card to buy things
You make regular repayments on time
The card has low fees
5. Pay your bills on time
Unfortunately your credit report doesn't necessarily record all the years you've spent paying your phone, internet, electricity and gas bills on time. Bills are not credit.
But if you've missed a bill payment by more than 14 days it will negatively affect your score.
So make sure you pay your bills on time. Setting up direct debits for your bills (or even automatic reminders) is the easiest way to do this.
6. Lower the limit on your credit card
If you already have a credit card and you're making repayments on time, you can further improve your credit score by lowering the card limit.
That's the maximum amount you can spend using the card. It's much easier to get into financial trouble with a card that lets you spend $6,000 versus one with a limit of $2,000.
If you don't need to make big purchases on your credit card, lower your limit.
7. Avoid multiple debts, especially high interest ones
A borrower with a single credit card and a home loan who never misses a repayment is likely to have a strong credit score.
But if you have 3 credit cards and 2 personal loans you'll struggle to improve your credit score even if you never miss a repayment.
Alternatively, prioritising paying off one of the loans completely would help too. A balance transfer credit card can be the best way to roll card debts into one manageable debt.
8. Avoid applying for too many credit products at once
When you apply for a loan or credit card the lender requests a copy of your credit report. This is called a hard inquiry and it can negatively affect your report.
This is because multiple applications for credit in a short time are considered a bad sign.
To avoid this:
Don't apply for multiple debts at once
Apply for a single credit product from a single provider
Make sure your application is completed correctly and that you're eligible for the product before you apply
🔥 Hot tip
Getting rejected for a credit application hurts your credit score because of the hard inquiry mentioned above. Avoid applying for another credit product until you understand why you got rejected for the first one. Multiple inquiries can harm your credit score even more.
Checking your own credit score is considered a soft inquiry and doesn't affect the score in any way.
Missing BNPL repayments will hurt your credit score. And some BNPL providers make a credit enquiry when you sign up, meaning the company takes a look at your credit report. This can impact your credit score too.
Finder survey: Have many Australians have taken steps to improve their credit score?
Response
No
68.8%
Yes
31.2%
Source: Finder survey by Pure Profile of 1016 Australians, December 2023
More useful tips to get a better credit score
Time heals all credit wounds
If you've had a very bad run with your finances – missed payments, defaults, a bankruptcy – then time is your friend.
In Australia, defaults stay on your credit report for 5 years. Missed payments stay for 2. If you were declared bankrupt, the bankruptcy stays on your report for 2 years from the end date or 5 years from the date you became bankrupt (whichever of the 2 is later).
So while all the tips we've outlined above are very useful, for people with terrible credit the passage of time also helps a lot. Just avoid getting into more credit trouble in the meantime.
Credit repair companies
There may be mistakes on your credit report you can fix. And there are companies that offer credit repair services who can fix those for you.
But these companies can charge high fees and are often just doing things you can easily fix yourself, for free.
Keep a good credit card
Paying off debts completely is good financial advice. But it's often worth keeping a credit card you rarely use and have always paid off on time. This card is a good example of your creditworthiness.
Just make sure you keep the limit as low as possible.
Get help
If you're struggling to make repayments and need financial help you have options:
Talk to your utility and credit providers. Before you miss a payment talk to your providers. They have hardship support schemes and payment plans available for customers.
Get free financial counselling. The National Debt Helpline has free financial counsellors you can speak to on 1800 007 007.
What's the best way to improve a bad credit score?
Here are the 3 key steps you should take today to boost your score:
Pay off any outstanding debts or overdue bills.
Make sure your credit report is accurate
Consolidate your debts and loan accounts
How do I improve my credit score fast?
Unfortunately there is no quick fix or shortcut to improving your credit score. If you have a poor score, it can often take time before you see a huge improvement in your credit rating.
However, by consistently following the steps above you should see your score gradually increase.
One exception may be if you have multiple errors in your credit report that are harming your score. Getting these corrected and removed from your report may have an immediate impact on improving your credit score.
Finder helped me improve my credit score, and find the best credit card and high interest saving account.
Jose, VIC
Understanding my credit score and where my expenses go has helped me spend less on material items and save more to set me up for later in life.
Mikayla, SA
Finder has been super helpful for me to run a credit score check, which I've never done before, and find out where I'm sitting financially – thank you!
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Richard Whitten is a money editor at Finder, and has been covering home loans, property and personal finance for 6+ years. He has written for Yahoo Finance, Money Magazine and Homely; and has appeared on various radio shows nationwide. He holds a Certificate IV in mortgage broking and finance (RG 206), a Tier 1 Generic Knowledge certification and a Tier 2 General Advice Deposit Products (RG 146) certification. See full bio
Richard's expertise
Richard has written 553 Finder guides across topics including:
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Hello,
I purchased a home 7 months ago, I have a mortgage yet this is not listed on my credit file , why is this so ?
ArnoldApril 6, 2018
Hi Paul,
Thanks for your inquiry
There are several reasons why your mortgage may not appear on your credit report, including:
1. Lender not reporting: Some mortgage lenders – especially smaller firms – do not always report mortgages to the credit bureaus, unless there is a problem. This means, your good payment history will not show up, but any late or missed or late payments could appear.
2. Clerical errors: Mistakes happen. A human or computer error could cause your mortgage from not appearing. All it takes is an error on one digit of your Social Security number or any other small mistake that can keep your mortgage from the report.
3. Non-traditional financing: If you borrow directly from and are paying your home’s previous owner (rent-to-own agreement) or if you use some other form of non-traditional lending, your mortgage most likely will not appear on your credit report.
4. Bankruptcy: Filing for Chapter 7 bankruptcy wipes out all debt allowed by federal law. If a reaffirmation agreement is not signed, your mortgage may not appear on your credit report.
5. Delay in reporting: It typically takes 30 to 60 days after you sign your mortgage paperwork for it to appear on our credit report. Processing delays during busy seasons could delay this even longer.
6. Name not on mortgage: If you and your spouse bought a home, but only your spouse’s name appears on the mortgage for financing reasons, the mortgage will not appear on your credit report.
If your mortgage is not appearing on your credit report, you might be able to get it added. You cannot submit your mortgage yourself, but you can check for clerical errors and ask your lender to correct them.
If your lender does not report your mortgage to any of the credit bureaus, you cannot force them to do so. However, if you are trying to get a new mortgage, you can present your prospective lender with evidence of the loan and your payment history.
Hope this information helps
Cheers,
Arnold
LucyMarch 22, 2018
Hello,
I have a credit score of average (591 out of 1200) and I have now obtained my credit report. I do not have any defaults or bankruptcy’s in my credit file, only enquirys so would like to know why my credit score is so bad?
Thank you
Finder
JeniMarch 22, 2018Finder
Hi Lucy,
Thank you for getting in touch with finder. Credit enquiries, or loan applications, are not necessarily bad, but having numerous enquiries listed in a short period of time can be. Generally, applying for credit once every three months will not contribute to a lower score. If you spot an error, get in touch with the lender in question and ask it them to rectify the mistake. If you’re not happy with the way the lender handles this, you can always get in touch with the relevant Ombudsman service.
I hope this helps.
Have a great day!
Cheers,
Jeni
RebeccaMarch 22, 2018
I would like to know why I have such a terrible credit score and how I repair it
Finder
JeniMarch 22, 2018Finder
Hi Rebecca,
Thank you for getting in touch with finder. Missed repayments, loan defaults, debt agreements and bankruptcy details are collected by credit-reporting agencies and can all feature in your credit file. The agencies then use this information to calculate your risk as a borrower, with this risk reflected as a credit score. To check why you have a bad credit score you can order a copy of your credit file from one of Australia’s three main credit reporting agencies: Equifax, Dun & Bradstreet or Experian. To repair your credit score there are some steps that you can do like getting a copy of your credit file and monitor your credit score from time to time, fixing any incorrect listings, taking control of your debt, staying on top of repayments, avoiding making multiple credit applications and contacting the National Debt Helpline on 1800 007 007 to find free financial counselling in your area. Financial counsellors offer independent expert advice on how you can manage your money and eliminate debt.
I hope this helps.
Have a great day!
Cheers,
Jeni
JoelyMarch 17, 2018
How do I get a list of defaults etc so I can improve my credit rating?
Finder
JhezelynMarch 17, 2018Finder
Hi Joely,
Thank you for your comment.
You may request a free credit report to see everything about your financial history. Note that this may take up to 10 days to receive your credit report. You may also refer to our guide on how to remove defaults under your name.
Regards,
Jhezelyn
KevinFebruary 28, 2018
I would like to know why my credit rating is so bad. I was bankrupt around 10 years ago but since then I have always paid everything on time, had a car loan for $31,000 have paid that back. I have a couple of small loans out that I always pay on time, have worked for the same company for 28 years. I’m confused as to why my credit rating is so bad? Thanks.
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Hello,
I purchased a home 7 months ago, I have a mortgage yet this is not listed on my credit file , why is this so ?
Hi Paul,
Thanks for your inquiry
There are several reasons why your mortgage may not appear on your credit report, including:
1. Lender not reporting: Some mortgage lenders – especially smaller firms – do not always report mortgages to the credit bureaus, unless there is a problem. This means, your good payment history will not show up, but any late or missed or late payments could appear.
2. Clerical errors: Mistakes happen. A human or computer error could cause your mortgage from not appearing. All it takes is an error on one digit of your Social Security number or any other small mistake that can keep your mortgage from the report.
3. Non-traditional financing: If you borrow directly from and are paying your home’s previous owner (rent-to-own agreement) or if you use some other form of non-traditional lending, your mortgage most likely will not appear on your credit report.
4. Bankruptcy: Filing for Chapter 7 bankruptcy wipes out all debt allowed by federal law. If a reaffirmation agreement is not signed, your mortgage may not appear on your credit report.
5. Delay in reporting: It typically takes 30 to 60 days after you sign your mortgage paperwork for it to appear on our credit report. Processing delays during busy seasons could delay this even longer.
6. Name not on mortgage: If you and your spouse bought a home, but only your spouse’s name appears on the mortgage for financing reasons, the mortgage will not appear on your credit report.
If your mortgage is not appearing on your credit report, you might be able to get it added. You cannot submit your mortgage yourself, but you can check for clerical errors and ask your lender to correct them.
If your lender does not report your mortgage to any of the credit bureaus, you cannot force them to do so. However, if you are trying to get a new mortgage, you can present your prospective lender with evidence of the loan and your payment history.
Hope this information helps
Cheers,
Arnold
Hello,
I have a credit score of average (591 out of 1200) and I have now obtained my credit report. I do not have any defaults or bankruptcy’s in my credit file, only enquirys so would like to know why my credit score is so bad?
Thank you
Hi Lucy,
Thank you for getting in touch with finder. Credit enquiries, or loan applications, are not necessarily bad, but having numerous enquiries listed in a short period of time can be. Generally, applying for credit once every three months will not contribute to a lower score. If you spot an error, get in touch with the lender in question and ask it them to rectify the mistake. If you’re not happy with the way the lender handles this, you can always get in touch with the relevant Ombudsman service.
I hope this helps.
Have a great day!
Cheers,
Jeni
I would like to know why I have such a terrible credit score and how I repair it
Hi Rebecca,
Thank you for getting in touch with finder. Missed repayments, loan defaults, debt agreements and bankruptcy details are collected by credit-reporting agencies and can all feature in your credit file. The agencies then use this information to calculate your risk as a borrower, with this risk reflected as a credit score. To check why you have a bad credit score you can order a copy of your credit file from one of Australia’s three main credit reporting agencies: Equifax, Dun & Bradstreet or Experian. To repair your credit score there are some steps that you can do like getting a copy of your credit file and monitor your credit score from time to time, fixing any incorrect listings, taking control of your debt, staying on top of repayments, avoiding making multiple credit applications and contacting the National Debt Helpline on 1800 007 007 to find free financial counselling in your area. Financial counsellors offer independent expert advice on how you can manage your money and eliminate debt.
I hope this helps.
Have a great day!
Cheers,
Jeni
How do I get a list of defaults etc so I can improve my credit rating?
Hi Joely,
Thank you for your comment.
You may request a free credit report to see everything about your financial history. Note that this may take up to 10 days to receive your credit report. You may also refer to our guide on how to remove defaults under your name.
Regards,
Jhezelyn
I would like to know why my credit rating is so bad. I was bankrupt around 10 years ago but since then I have always paid everything on time, had a car loan for $31,000 have paid that back. I have a couple of small loans out that I always pay on time, have worked for the same company for 28 years. I’m confused as to why my credit rating is so bad? Thanks.
Hi Kevin,
Thank you for your comment.
You can access a free credit report to know how you got that certain credit rating. You can also learn the factors that can cause bad credit rating.
Moreover, if you wish to have your credit score repaired, you may refer to our complete guide to credit repair.
Hope this helps.
Regards,
Jhezelyn