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In Australia, we have more of a ‘negative’ credit file recording system. What this means is that besides credit application enquiries, it is really credit related problems such as defaults, court judgments and bankruptcies that will appear as a listing on the database.

Keep Your Credit File Clean

If you have been the model borrower, unfortunately this does not get reported to VEDA. It is really only the negative reports that get picked up on your credit file. Also to note is that whilst a credit provider will check a consumers’ credit file prior to offering them credit, that lender (or credit provider) may not necessarily update the credit file to confirm that the consumer took up the credit offering.  Because of this, lenders generally look more at the number of credit applications you have made over a period of time, rather than how many of these you actually took up. 

For this reason it is very important when shopping around for a mortgage, that you don’t make multiple applications with multiple lenders. It isn’t a good look on your credit file and will actually reduce you credit score. Instead, shop around first and do your homework, then once you have decided which lender you want to go with, that’s when it is time to submit a formal application.