How credit reports and scores work

What’s on my credit report?

What are credit reports? A credit report includes any payment defaults recorded against your name. A default is where a payment has been overdue for more than 30 days, and the lender has taken steps to recover the outstanding amount.

A default can stay on your credit record for five years, even after you’ve paid the amount in full.

A credit file can also show how much you’ve borrowed and whether you’re making regular repayments (such as credit card, hire purchase, car finance and mortgage repayments) on time. Payment of power and phone bills may also be included in your file. So the more repayments you make on time, the cleaner your credit report is. 

How do I check my credit score?

Everyone has a legal right to request information held about us by a credit reporter – at no cost. 

It’s free to check your credit score, although if you want the information quickly (within five working days) you may be required to pay a fee. To order a credit report, contact the credit reporters directly. The following credit reporters operate in New Zealand:

• Centrix
• Equifax
• illion

To correct or freeze information on a credit report, make sure to contact all three. For a fee, some credit reporters, such as Equifax, will load a monitor on your credit file to alert you to applications for credit made using your identity. Find out more about rights on the Privacy Commissioner's website.

It’s a good idea to regularly check your credit report, especially if you’re thinking about borrowing in the near future.

Who checks my credit history?

Lenders usually check your credit history whenever you apply for credit – whether it’s a mortgage, a personal loan, hire purchase, car finance or a new credit card. Phone and power companies may also check your credit score if you apply for those services on credit. A prospective landlord or insurer might check your credit history. Some employers even make credit checks on job applicants.

They do this by making an enquiry to a credit reporter – an organisation that collects credit information and sells reports on an individual’s credit history to businesses.

Something to keep in mind is that having lots of checks run on your credit history can make it look like you’re taking on a lot of debt. For example, say you’re shopping around for a car. You visit five dealers, who all take your licence and do a credit check. Having so many credit checks done in a short period of time can lead to lenders turning you down. 

Key terms

Credit score FAQs

What’s the difference between a credit report and credit score?

Your credit report is a record of your borrowing history – it includes your personal details, any defaults, court judgements, credit inquiries and your repayment history. Think of it as your financial CV. Your credit score is a number (typically 0-1000) that summarises how you look as a borrower based on that report. Lenders use this score to quickly assess whether to lend to you and what interest rate to charge. The more risky you are as a borrower, the more they charge in interest to cover themselves.

Will checking my own credit history affect my score?

No, checking your own credit report doesn't affect your score at all. This is called a 'soft inquiry' and it's invisible to lenders. However, when a third party (like a bank, landlord or employer) checks your credit, it shows up as a 'hard inquiry' on your report. Too many of these inquiries in a short time can look bad to lenders and may lower your score. So check your own report freely, but think twice before letting others run credit checks.

Do I need to borrow and keep some debt in order to build my credit score in New Zealand?

No – that's a myth! You don't need to carry debt or pay interest to build your credit score. What matters is showing you can manage credit responsibly. Paying bills on time (including power and phone), making regular repayments when you do borrow, and avoiding defaults all help build your score. If you have a credit card, paying it off in full each month actually shows better management than carrying a balance and paying interest unnecessarily.

Can I get my credit report for free in New Zealand?

Yes! You're entitled to a free credit report from each of New Zealand's three credit bureaus: Centrix, Equifax and illion. The free reports typically take up to 10 working days to arrive. If you need it urgently (within five working days), you may need to pay a fee. It could be worth checking all three as they may hold slightly different information. You can request your reports directly from each online.

What’s the difference between Centrix, Equifax and illion?

These are New Zealand's three credit reporting agencies. They're independent companies that collect and store credit information about individuals. Lenders, utility companies and others report your payment behaviour to them. Each agency may hold slightly different information depending on which organisations report to them.

How often should I check my credit report?

Check your credit report at least once a year to ensure it's accurate and watch for signs of identity fraud. If you're planning to apply for credit (like a mortgage or car loan), check it a few months beforehand so you have time to fix any errors.

What’s a default? How long does a default stay on my credit report in New Zealand?

A default is a missed payment that's been overdue for more than 30 days, where the lender has taken steps to recover the money. It's serious and shows up on your credit report, making it harder to borrow in future. Even after you pay the debt in full, the default stays on your credit report for five years from the date it was recorded.

How do I remove incorrect information from my credit report?

Contact the credit agency directly and ask them to correct the error. They're required to investigate and fix mistakes. If the incorrect information came from a specific lender (like a default you've already paid), contact that lender first as they may need to notify the agency. You'll want to keep records of all your communications. 

Does being a guarantor affect my credit rating?

Yes – when you guarantee someone’s loan, you're legally responsible if they can't pay. The loan will show on your credit report and affect how much you can borrow yourself, even if the other person is making all the payments. If they miss payments or default, it damages your credit score too. Guaranteeing a loan is a serious commitment. Only do it if you can afford to repay the entire loan yourself and trust the person completely.

How can I improve my credit score quickly?

Pay all your bills on time – this is the single biggest factor. Set up automatic payments so you never miss one. Check your credit report for errors and get them fixed. If you have short-term debt, pay it down as quickly as possible. Avoid applying for multiple loans or credit cards in a short time. If you have a card, keep the balance low relative to your limit. If you have defaults, pay them off (they'll still show for five years, but being paid looks better than unpaid).