The frequency at which your credit score changes will depend on how often a bank, lender or service provider offers this information to credit bureaus, and how often a credit bureau assesses your individual credit history and payment behaviour.
It has been reported that creditors report to credit bureaus every 30-45 days. When credit bureaus receive this information they may then assess the impact of it and potentially update your credit score. Unfortunately, how often a credit reporting bureau will change or update your credit score is not public knowledge.
It’s safe to say that credit bureaus cannot analyse the payment behaviour and credit information of every eligible Australian every single day. Instead, we might assume this information is updated closer to every one to three months. This is because you can receive a free copy of your credit history from any of the major bureaus (Experian, Equifax or illion) every three months.
Regardless, one of the safest ways to keep on top of your credit score and monitor for any changes is to use a credit score checking platform, such as the free Credit Score app offered by RateCity.
What can affect your credit score?
Any repayment behaviour and use of credit products can affect your credit score. This doesn’t just refer to loans, but can also relate to energy bills and phone bills
The factors that can affect your credit score include:
- The length of your credit file;
- Opened and closed, including bank accounts and credit cards;
- The type and amount (credit limits) of credit you have applied for in the past;
- Applications, including any rejections;
- Your repayment history – both positive and negative;
- Negative events, such as late payments or default judgements, court writs, or bankruptcies.
Previously, credit scores in Australia only reflected adverse credit events, such as late payments and defaults. Thanks to the introduction of Comprehensive Credit Reporting (CCR), your credit file should include positive repayment behaviour as well, such as paying off a loan, or making your bill payments on time.
According to Equifax, this is how long you may expect various events to appear on your credit report:
Positive events
- Active accounts paid as agreed – will remain on report if the account is open, such as repaying a mortgage, and the lender is reporting it.
- Closed accounts paid as agreed – may stay on your report for up to 10 years.
Negative events
- Hard enquiries into your credit report – up to 2 years.
- Late repayments – may last up to 7 years.
- Collection or charged-off accounts - may last up to 7 years.
- Bankruptcy – may last from 7 – 10 years.
- Other events, including repossession and foreclosures – up to 7 years.
Does your credit score get reset by Australian credit bureaus?
Technically, your credit score may not be reset, but you can work to improve it. Sometimes it may simply be that you need to correct the details in your credit report.
Credit bureaus don’t usually remove negative incidents from your credit file. They do, however, expire from your credit report over time, as noted above. Remember that if any of the information on your credit report isn’t accurate, you must contact the credit bureau and the lender/provider immediately. This may include:
- Your personal details, including identification and contact information.
- Credit transactions reported more than once.
- Incorrectly reported debt or repayment amounts.
- Fraudulent transactions that you can prove aren’t yours.
On the other hand, improving your credit score requires patience and effort on your part. Here are some of the things you can do that can help improve your credit score:
- Ensure you pay off your bills, debts, and loans on time or early.
- If you have several debts, try to consolidate them or bring down the outstanding amount.
- Wait to apply for new loans or credit cards until you lower your current debts.
- Reduce the number of credit cards you hold.
