All the latest news, facts and tips from the team at Pioneer Credit Connect

Jul 19

What is my Credit File and how does it work?

by Lachlan Hayes
What is my Credit File and how does it work?

At the very first moment you apply for credit, whether it’s a loan or even a phone plan, your credit file is created to track your credit history and credit worthiness into the future.

It doesn’t even matter if you actually followed through with the application, formally expressing your interest in a product is usually enough to get the ball rolling, but whilst most of us have a rough idea of what a credit file is, do we actually know how they work and what information they contain?

What is a credit file and how is it different to my credit score?

Your credit file is a history of all your credit applications, which helps lenders to determine your ‘credit worthiness’, which is basically a fancy term for how likely you are to repay the loan. Your credit score on the other hand, is a representation of everything that makes up your credit file in the form of an easy-to-read number out of 1,000 or 1,200; depending on who you get your credit score from. Think of it like a summary of your credit file in a numerical form.

When it comes to obtaining credit, some lenders may rely only on your credit score to decide whether to lend to you, whilst other more cautious lenders may check every line of your credit file to better understand your financial situation before sending you the funds.

What information is on my credit file?

Any information that you provide when you apply for a loan or other credit product could be added to your credit file. This can include your name, date of birth, current and previous addresses and even current and previous employment. As you apply for more credit in the future, your file will be updated with the most recent personal details you provide, so lenders are always in the know when your information changes.

In addition to this, whenever you apply for credit, the potential lender may leave a note on your credit file for items such as the loan amount, date of application and the lenders name, regardless if you were approved or not.

Companies that you have taken out a loan with can also add information to your credit file based on your positive or negative behaviour. These are things like: repayment history, previous applications, your current loans as well as some negative indicators. Negative indicators are pieces of information such as defaults, judgments and bankruptcies which can last on your credit file for years, even if the matter has been resolved. The inclusion of this information on your credit file is called Comprehensive Credit Reporting and is a relatively new concept in Australia where positive actions like making repayments on time may increase your credit worthiness whilst missing payments may make you appear less favourable to lenders.

See the table below to learn how long some information may stay on your credit file:

Credit file information

Length of time on credit file

Negative information


Late payments

Up to 7 years


Up to 7 years


Up to 7 years

Court Judgment


Positive information

At least 7 years

Active accounts that are being paid

For as long as the account is being paid

Closed accounts that have been paid

Up to 10 years

How does my credit file impact my ability to get credit?

The information that affects your credit file are the positive and negative credit activities, rather than your personal information. More serious negative information such as repossessions, court judgements and bankruptcy can seriously hinder your ability to get credit for as long as these things are on your credit file, in fact you may not be able to get approved for a loan at all! The less serious information such as late payments won’t have much of an impact on your creditworthiness unless it’s a recurring event. Sometimes it doesn’t take much to forget a payment once or twice, but if lenders determine that it’s a frequent occurrence on your credit file, they may charge you a higher interest rate or reject your application all together.

Positive information on the other hand can be a powerful tool to better your credit file whilst also boosting your savings. If you’re able to display a healthy track record of on-time repayments, you might be able to negotiate yourself a better rate with your current providers or even refinance with another lender to secure a cheaper rate! Alternatively, if a negative action is removed from your credit file after 7 years, it could also positively impact your file.

How can I improve my credit file?

To improve your credit file and credit score, there are a few things you can do, but the best place to start is actually getting a copy of your credit report! To get a free copy of your credit file from Equifax, simply fill out this form - it should only take around 10 days for it to be delivered to you.

Steps to improve my credit file:

  • Make sure your credit file is an accurate representation of your credit history. If something is amiss, report it to your credit agency so that they can investigate it and correct any errors.
  • Pay your bills on time. You can download our free app, Pioneer Path, which will help you budget and track your bills so that when you do have a payment due, you’ll have the funds available!
  • Reduce your debt. Paying down your debt can significantly improve your credit file. It may be worth looking at consolidating your debt or even refinancing to a cheaper rate.
  • Track your credit score. With Pioneer Path, you’ll also be able to get monthly updates on your credit score so you can make sure it stays on course.
  • Be careful with your enquiries! Since credit enquiries can affect your credit file, only apply for loans if you truly need them and read as much information about applying for them so that you can be certain you have the best chance of being approved.


The information provided in this blog is general advice only. It has been prepared without taking into account any person’s individual objectives, financial situation or needs. Before acting on any information in this blog you should consider its appropriateness to you, having regard to your objectives, financial situation and needs.