What is bad credit? And what is a bad credit loan?

“Bad Credit” refers to certain types of information that’s able to be recorded on your credit file, held by a credit reporting agency in Australia.

“A credit file includes information about you such as your full name, date of birth, driver’s licence, gender and residential addresses and employer information.” Visit Equifax for information about credit files. Some information that lead to your credit file being classified as “Bad” are:

  • credit defaults;
  • being in Bankruptcy;
  • excessive enquiries; and
  • having multiple credit files.

Having “Bad Credit” prevents your from obtaining personal loans from mainstream lenders, (for example: banks and credit unions), which limits your choices to applying with smaller organisations who offer these types of loans, commonly referred to as bad credit loans. Each finance company interprets your credit file differently and the over the next few weeks Fair Go Finance will give you some tips on how to improve your credit rating.

What you should do next:

Get a FREE copy of your credit file from Equifax, (previously known as Veda Advantage) so you know what is on it and where you are starting from. Arrange a free copy of your credit file at Equifax’s website. Learn more about our bad credit loans and how they may help you.

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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.