Your credit score is more than just a number—it’s one of the main factors affecting your ability to borrow money. Banks and lenders look at it to see if they should give you a loan and what kind of interest they’ll charge.
Whether you’re dreaming of a house, a new car, or just a personal loan, a better credit score can mean much better deals and more cash in your pocket!
At Loansmart, we understand that life happens, and sometimes your credit history isn’t perfect. So, what can you do to give your credit score a boost? Keep reading to learn about some proven strategies, plus find out how Loansmart can help you get back on track.
What Is a Good or Poor Credit Score in New Zealand?
In New Zealand, credit scores typically range from 0 to 1,000. Here’s how they break down:
- Excellent (800–1,000): Highly likely to be approved for credit with the best rates.
- Very Good (700–799): Lenders view you as a reliable borrower.
- Average (500–699): Access to standard loan terms across various financial products.
- Fair (300–499): May encounter higher interest rates and difficulty getting approved.
- Poor (below 300): Struggle to secure credit—loans or credit cards may be out of reach.
Want to find out what your credit score is? You can request a free report from one of New Zealand’s major credit reporting agencies: Centrix, Equifax, and Illion.
Don’t have a credit score? Check out our helpful article about how to build a credit score if you don’t currently have one.
What Things Affect Your Credit Score?
Lots of factors go into your credit score. One big thing is whether you pay your bills on time – like your credit card, loan, or even power bill. If you’re always late, that can really hurt your score.
Another thing is how much of your available credit you’re actually using. Think of your credit limit like a pie. You don’t want to eat too much of that pie! Ideally, use less than a third of what you could borrow. That shows you’re not relying too heavily on credit.
How long you’ve been using credit also matters. If you’ve had credit for a while and have a good track record of paying things back, that looks good to lenders.
Finally, it can actually be a good thing if you have different types of credit, like a credit card and a car loan. It shows you can manage different kinds of borrowing. Knowing all this stuff and keeping on top of it can really help your credit score get better over time!
5 Proven Ways to Improve Your Credit Score in NZ
1. Pay Your Bills on Time
Missing credit card, utility, or loan payments can seriously harm your credit score. To avoid this, consider setting up automatic payments or payment reminders. Remember that even one late payment can have a long-term negative impact.
2. Don’t Max Out Your Credit
This is known as credit utilisation—the ratio of your credit balances to your credit limits. Ideally this should be below 30%. So, if your credit limit is $1,000, try to keep your balance under $300. High credit utilisation can signal financial stress to lenders and negatively affect your score.
3. Avoid Applying for Multiple Credit Accounts at Once
Each time you apply for credit, a hard inquiry is recorded on your credit report. Multiple applications in a short period can lower your score and make lenders wary. Research your options thoroughly before applying to minimise unnecessary inquiries.
4. Check Your Credit Report Regularly
Mistakes or outdated information on your credit report can drag down your score. Request free copies from New Zealand’s credit reporting agencies and dispute any inaccuracies promptly. Correcting errors can lead to a quick score improvement.
5. Maintain Old Accounts and Manage Debt Wisely
Keeping those older credit accounts open, even if you don’t use them much, actually looks good because it shows you’ve been handling credit responsibly for a while. Also, if you’ve got a few debts with high interest rates, rolling them into one loan can make things simpler to pay and might even give your credit score a little boost!
How Loansmart Can Help
At Loansmart, we specialise in connecting you with a wide range of low-cost lenders. Our extensive network increases your chances of approval, even if your credit score isn’t perfect. We understand that life happens, and we’re here to help you navigate your financial journey with smarter loan solutions.
To help you get back on track, we provide:
- Low-cost debt consolidation loans and personal loans
- Super simple 3-minute online loan application
- Rates from just 9.95% Flexible repayment plans, with terms from 6 months to 7 years
- Expert advice from our friendly loan advisors
- Fast approval within 1-2 hours*
- Same day payout*
*Subject to responsible lending checks and criteria
Ready to Take Control of Your Credit?
Improving your credit score doesn’t happen overnight, but with consistent effort and smart financial habits, you can see significant progress. If you’re looking to secure a loan or want to explore your options, Loansmart is here to assist you every step of the way.
