Ever wondered why the bank said yes or no when you applied?
Clue: It ain’t because of that cheeky smile you gave to your computer screen when you applied.
Two words: Credit Score
Here’s a list of your most valuable assets:
But get this: 70% of Aussies don’t even know what a credit score is?
It’s a number between 0 - 1200 that represents your 'financial history'.
When you apply for a loan, the bank uses your credit score as a way to work out how “risky” you are as a borrower, and then decides if it’s a yay or nay.
But wait, there’s more: Even after you’re approved for a loan, your credit score can still impact the amount you can borrow (for other loans and cards) and the interest rate you pay (AKA how much you have to repay each month).
Of course, it’s a little more complex than this because your credit score also includes other info like the how long you’ve been using loans or credit cards, and how many of these you have… but you get the gist.