What is bad credit and how does it affect me? |

Whiteboard Wednesday with Walshy

Walshy is back to answer your questions on bad credit in this week’s episode:

  • What is bad credit?
  • How do I know if I have bad credit?
  • How does my credit score affect me?
  • Where can I find out my credit score?


Hi I’m Paul Walshe, the founder and CEO of Fair Go Finance.

Welcome to another episode of Whiteboard Wednesday.  So today’s topic is credit grades in Australia and their impact on you.

What is bad credit?

So different credit grades in Australia exist and lenders will put people into one of three broad categories: good credit, ok credit and bad credit.

How does my credit score affect me?

So the impact of being in a particular category is that it will influence your access to, and the price you pay for, credit.  So if you’re in a good credit category, which is typically someone with a high credit score, then you’re likely to have a lower chance of default and a lender will provide you with a larger amount of capital and at a lower price.

Whereas if you’re in a bad credit category, then typically you’re on a lower score, you’re deemed a higher risk and hence the amount of capital, or amount you can borrow, plus the cost you pay for that capital is a higher cost.

So your credit grade will impact you by limiting your access or determining your access to personal loans.

How do I know if I have bad credit?

So what you can do about this is to basically find out what category you’re in, is driven by your score and a couple of places to go get your score are GetCreditScore.com.au and CreditSimple.com.au. So you can subscribe to those services, you’ll get your score, or alternatively go to the bureaus Equifax, Experian or Dun and Bradstreet and they’ll provide you with access to your file and can do it for free.

So hopefully you found that informative, you can understand you can get your score, understand the category you sit in and the impact it may have on you and perhaps explain some frustrations you’ve had in accessing credit in the past.

Thanks very much, for further information you can subscribe to our Youtube channel or follow us on Twitter @FairGoFinance.

Thanks very much.

credit score

Credit Score CC BY-SA 3.0Nick Youngson




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Are you eligible to apply?


It can be expensive to borrow small amounts of money and borrowing may not solve your money problems.

Check your options before you borrow:
For more information about other options for managing bills and debts, ring 1800 007 007 from anywhere in Australia to talk to a free and independent financial counsellor.

Talk to your electricity, gas, phone or water provider to see if you can work out a payment plan.
If you are on government benefits, ask if you can receive an advance from Centrelink.

The Australian Government’s MoneySmart Website shows you how small amount loans work and suggests other options that may help you.

* This statement is an Australian Government requirement under the National Consumer Credit Protection Act 2009.