Protecting your credit score: ten practical habits

Your credit score is one of the most important factors lenders consider when assessing a loan application. Whether you are applying for a home loan, refinancing your mortgage, financing a vehicle or taking out a personal loan, maintaining a healthy credit profile can improve your borrowing options and help streamline the application process. The good news is that protecting your credit score does not have to be complicated — a few consistent financial habits can go a long way.

This article, written by Mary Nebotakis, Managing Director, Natloans (B. Eco, Dip. Financial Services) and published on 20 July 2026, sets out ten practical habits every Australian borrower should know, along with answers to common questions about how credit scores work.

General information notice: The information in this article is general in nature and does not take into account your personal objectives, financial situation or needs. Before making any financial decisions, consider whether the information is appropriate for your circumstances and seek professional advice where required.

What Is a Credit Score?

A credit score is a numerical representation of your creditworthiness based on information contained in your credit report. As stated in the Natloans article published 20 July 2026, credit reporting bodies consider a range of information, including:

Lenders may use this information, along with other financial details such as income, expenses and employment, when assessing your application. While every lender has its own assessment criteria, maintaining a strong credit profile can place you in a better position when applying for finance.

10 Smart Habits to Protect Your Credit Score

1. Pay Your Repayments on Time

One of the simplest ways to protect your credit profile is to consistently make repayments by their due date. This includes home loans, car loans, personal loans, credit cards, Buy Now Pay Later commitments where relevant to your financial position, and utility and telecommunications accounts where applicable. Setting up direct debits or payment reminders can help you stay on top of your commitments.

2. Avoid Making Multiple Loan Applications at Once

Every time you formally apply for credit, a credit enquiry may be recorded on your credit file. Submitting numerous loan applications with different lenders over a short period can make it appear that you are urgently seeking credit, even if your intentions are perfectly reasonable. Working with an experienced finance broker can help, because rather than applying with multiple lenders yourself, a broker can help identify suitable lending options before you submit a formal application.

3. Check Your Credit Report Regularly

Mistakes can happen. Reviewing your credit report periodically allows you to:

If you notice incorrect information, you can contact the relevant credit reporting body or lender to investigate.

4. Only Borrow What You Need

It can be tempting to apply for the maximum amount available, but borrowing responsibly is an important part of maintaining long-term financial health. Only taking on debt that is appropriate for your circumstances can make repayments more manageable and reduce financial pressure. Responsible borrowing also helps you build a positive repayment history over time.

5. Keep Credit Card Limits Under Control

Lenders often consider not only how much you currently owe, but also how much credit is available to you. If you have several credit cards with high limits that you rarely use, it may be worth reviewing whether you still need them. Reducing unnecessary credit limits or closing unused accounts can help simplify your finances. Before making any changes, consider how they may affect your overall financial situation.

6. Don't Ignore Financial Difficulties

If you are experiencing financial hardship, it is generally better to seek assistance early rather than falling behind on repayments. Many lenders offer hardship support options that may help borrowers experiencing temporary financial difficulties. Speaking with your lender, or an experienced finance broker, as early as possible often provides more options than waiting until repayments have already been missed.

7. Be Careful When Acting as a Guarantor

Agreeing to guarantee someone else's loan is a significant financial commitment. If the primary borrower is unable to meet their obligations, the guarantor may become responsible for the debt under the terms of the guarantee. Before agreeing to become a guarantor, it is important to fully understand the responsibilities involved and seek independent advice if necessary.

8. Protect Yourself Against Identity Theft

Identity theft can lead to fraudulent credit applications being made in your name. Simple protective steps include:

Protecting your personal information is an important part of protecting your financial reputation.

9. Review Your Loans Regularly

Your financial needs change over time. Reviewing your loans every 12 to 24 months allows you to determine whether your current lending still suits your circumstances. A review may also identify opportunities to refinance, consolidate debts or improve your overall loan structure. Importantly, reviewing your options does not necessarily mean submitting multiple loan applications.

10. Speak to a Finance Broker Before You Apply

One of the smartest ways to protect your credit profile is to seek professional guidance before lodging a formal application. An experienced broker can compare products across a range of lenders, help you understand your options, and identify suitable lending options before you proceed — reducing the likelihood of unnecessary credit enquiries on your file.

Common Myths About Credit Scores

Myth What the evidence says
"Checking my own credit score will hurt it." Generally, checking your own credit report through a recognised credit reporting body is considered a personal enquiry and does not lower your credit score.
"I need to carry credit card debt to build my score." No. Consistently meeting your repayment obligations is generally more important than carrying a balance.
"Every lender uses exactly the same credit score." Not necessarily. Different lenders may use different credit reporting information and apply their own lending policies alongside your credit report.

Why Your Credit Score Matters

A healthy credit profile may help improve your chances of securing finance that suits your circumstances. Whether you are purchasing your first home, refinancing, financing a vehicle or applying for a business loan, presenting a strong financial profile can make the application process smoother. Looking after your credit score today can help create more opportunities tomorrow.

Frequently Asked Questions

What is a credit score?

As stated in the Natloans article published 20 July 2026, a credit score is a numerical representation of your creditworthiness based on information contained in your credit report. Credit reporting bodies consider repayment history, credit applications and enquiries, existing loans and credit limits, defaults and serious credit infringements where applicable, and certain public record information such as insolvency events. Lenders use this information, along with other financial details, when assessing an application. Source: natloans.com.au

What is considered a good credit score in Australia?

As stated in the Natloans article published 20 July 2026, credit reporting bodies use different scoring models, so score ranges vary. In general, a higher credit score indicates a stronger credit history, but lenders also assess income, expenses, employment, existing liabilities and other factors when considering an application. Confirm current score ranges and thresholds directly with the relevant credit reporting body or with Natloans. Source: natloans.com.au

Does applying for a loan affect my credit score?

A formal credit application may result in a credit enquiry being recorded on your credit report. This is why it is important to understand your options before submitting multiple applications with different lenders.

How often should I check my credit report?

Review your report before a significant application or if you suspect an error or identity fraud. The OAIC says you can obtain a free credit report once every three months, and in additional specified circumstances. This access entitlement is distinct from a mandatory checking schedule.

Will checking my own credit report lower my score?

Generally, checking your own credit report through a recognised credit reporting body is considered a personal enquiry and does not lower your credit score. Confirm this with the relevant credit reporting body, as policies may vary.

Can a finance broker help protect my credit score?

An experienced finance broker can help you understand your borrowing options and identify lenders that may suit your circumstances before you submit a formal application, reducing the likelihood of unnecessary credit enquiries on your file.

Do I need to carry credit card debt to build a good credit history?

No. Consistently meeting your repayment obligations is generally more important than carrying a balance on a credit card.

What should I do if I find an error on my credit report?

If you notice incorrect information on your credit report, you can contact the relevant credit reporting body or lender to investigate and request a correction where appropriate.

What happens if I can't keep up with repayments?

If you are experiencing financial hardship, it is generally better to contact your lender or a finance broker early. Many lenders offer hardship support options that may help borrowers experiencing temporary financial difficulties. Acting early typically provides more options than waiting until repayments have already been missed.

What are the risks of becoming a loan guarantor?

If the primary borrower is unable to meet their obligations, the guarantor may become responsible for the debt under the terms of the guarantee. Before agreeing to become a guarantor, it is important to fully understand the responsibilities involved and seek independent advice if necessary.

How can I protect myself from identity theft affecting my credit file?

Practical steps include using strong and unique passwords, enabling multi-factor authentication where available, monitoring your financial accounts, being cautious of phishing emails and scam messages, and securely disposing of documents containing personal information.

How does refinancing relate to credit score management?

Reviewing your loans every 12 to 24 months can help determine whether your current lending still suits your circumstances and may identify opportunities to refinance or consolidate debts. Speak with a broker before submitting any formal applications, as unnecessary applications can result in additional credit enquiries. For more information, see Natloans' related article: Refinancing options in Australia.

Speak with the Team at Natloans

If you are thinking about applying for finance and want to put yourself in the strongest possible position, the experienced brokers at Natloans are here to help. The team takes the time to understand your circumstances, explain your options and guide you through the lending process.

Natloans offers access to products across more than 50 lenders and has assisted more than 10,000 clients. The business has received more than 900 five-star Google reviews and was recognised as Best Finance Brokerage (Office) – Victoria & Tasmania at the Better Business Awards 2026 (as stated on the Natloans website, retrieved October 2026; confirm current award status with Natloans).

To book a free 15-minute consultation, visit natloans.com.au or call 1300 955 791.

Related Reading

Source: Mary Nebotakis, Managing Director, Natloans. "How to Protect Your Credit Score in Australia: 10 Smart Habits Every Borrower Should Know." Published 20 July 2026, last modified 12 August 2026. natloans.com.au. Retrieved 15 October 2026. Rates, thresholds, lender counts and award details are as stated on the public page at the time of retrieval and should be confirmed with Natloans before relying on them.

Credit checks: evidence and limits

Equifax distinguishes personal file access from application-related enquiries. Accessing your own Equifax report does not reduce your Equifax score. A credit application may be recorded and may affect scoring, but the sources checked do not establish a fixed points deduction. Broker involvement alone does not establish that a check is non-scoring: ask about the type, consent and timing before proceeding.

Equifax: credit reports and enquiries; OAIC: free access (checked 15 October 2026).

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