7 Tips for Improving Your Credit Score

Your credit score is a critical factor considered by banks and lenders when applying for a loan or credit card. A good credit score could be the difference between securing your dream home or being denied a loan or a line of credit altogether. From regularly checking your credit report through to consulting with a finance broker in Melbourne, this article will go over seven practical tips you can use to enhance your credit score, making your financial journey smoother and more conducive for success.

Regularly Check Your Credit Report

Regularly reviewing your credit report allows you to identify any errors or discrepancies that could be impacting your score. It’s generally recommended that you check your report at least once a year and immediately report any inaccuracies to the credit bureau for rectification. In Australia, the credit bodies you can request a copy of your credit report from include Equifax, Experion and Illion.

Pay Bills on Time

Late payment of bills can negatively affect your credit score. To avoid this, ensure you pay all your bills on time. This includes things like rent, utilities, phone bills and any outstanding loans or credit card bills.

Maintain a Low Credit Card Balance

High credit card balances can lower your credit score. It’s advisable to maintain a credit card balance that’s less than 30% of your credit limit. This demonstrates to lenders that you can manage your credit responsibly.

Limit New Credit Applications

Each time you apply for a new line of credit, a hard enquiry is made on your credit report, which can lower your score. Limiting new credit applications can help maintain a good credit score. Instead of applying for new credit, consider using existing credit lines responsibly.

Diversify Your Credit

A diverse credit portfolio can positively impact your credit score. This could include a mix of credit cards, retail accounts, instalment loans, finance company accounts and mortgage loans. However, it’s important to manage this credit responsibly so it has a positive impact on your credit score.

Don’t Close Unused Credit Cards

Contrary to popular belief, closing unused credit cards may not improve your credit score. In fact, it could hurt it. Keeping these accounts open, provided they’re not costing you excessive fees, can contribute to your overall credit history length and benefit your score.

Seek Professional Help

If you’re struggling to improve your credit score, consider seeking guidance from a finance broker in Melbourne or your local area. They can provide expert tips tailored to your specific circumstances and help you find loan options that cater to lower credit scores.


Improving your credit score doesn’t happen overnight. It requires a consistent, disciplined approach to managing your finances. By following even just a few of these seven tips, you can be well on your way to enhancing your credit score and unlocking new financial opportunities. Whether you’re a business owner looking to expand or an aspiring homeowner wishing to secure their dream home, getting your credit score to where it needs to be can make the process much easier.

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