My Credit Score Dropped Suddenly — What to Do in Australia (2026)

Quick Answer: A sudden credit score drop in Australia is almost always caused by one of five things: a new default listing, a new hard enquiry (credit application), a missed payment recorded under Comprehensive Credit Reporting, a court judgement being listed, or identity fraud. Pull your free credit reports immediately from all three bureaus. If the cause is a default or enquiry that was listed in breach of the Privacy Act 1988, it can be removed — often within 30–90 days. Australian Credit Solutions (ASIC ACL 532003) offers a free assessment, 98% success rate on accepted cases, No Win No Fee, lawyer-led. Industry Excellence Award 2022, 2023 & 2024. 4.9/5 from 976+ reviews. 5,000+ Australians helped since 2014.

You checked your score. It dropped — 50, 100, maybe 150+ points. Last month it was fine. Now it's not. That sick-stomach feeling is real, and the next 48 hours matter. Here's what to do.

Step 1: Pull All Three Credit Reports Right Now

Don't guess. Don't assume. Pull the actual reports.

Australia has three credit bureaus — and a drop in one doesn't always appear in the others immediately. Get all three:

• Equifax: equifax.com.au (free annual report; paid for instant access)
• Experian: experian.com.au
• Illion: creditreport.com.au

You're entitled to one free report per year from each. If you need it urgently (you do), some bureaus offer same-day paid access.

Step 2: Identify the Cause

Once you have your reports, scan for anything new since your last check. Here are the five causes of a sudden credit score drop in Australia:

Cause 1: A New Default Has Been Listed

A default is a record of an overdue debt of $150+ that a creditor has listed on your file. Under the Privacy Act 1988, the creditor must have sent a Section 21D written warning giving you 30 days to respond before listing.

Score impact: 80–200 points drop, immediate. What to look for: New entry under "Defaults" or "Overdue accounts" — will show creditor name, date listed, amount.

Cause 2: A Hard Enquiry Was Recorded

Every credit application — loan, credit card, phone plan, rental background check using a credit bureau — creates a hard enquiry. If you recently applied for credit and didn't track it, this is likely.

Score impact: 5–15 points per enquiry; 4+ in 12 months compounds significantly. What to look for: New entry under "Enquiries" or "Credit applications."

Cause 3: A Missed Payment Recorded Under CCR

Since 2018, Comprehensive Credit Reporting (CCR) means every monthly repayment is tracked. A single 30-day late payment on any credit account — mortgage, credit card, personal loan — now appears on your file.

Score impact: 20–60 points per missed payment marker. What to look for: New negative marker in "Repayment History Information" section.

Cause 4: A Court Judgement Has Been Listed

If a creditor obtained a court order against you — even if you weren't aware proceedings were issued — it appears on your file once lodged with the court system.

Score impact: 100–200+ points, similar to a large default. What to look for: Entry under "Court Actions" or "Judgements."

Cause 5: Identity Fraud

Someone used your personal information to apply for credit or open accounts in your name. The applications and resulting accounts appear on your file.

Score impact: Varies — could be enquiries only, or defaults from accounts you didn't open. What to look for: Accounts, addresses, or applications you don't recognise.

Step 3: Match the Cause to the Action

Step 4: Assess Whether It's Removable

This is the most important question — and the one most Australians don't know to ask.

If your score dropped because of a default or enquiry, that entry may be removable under the Privacy Act 1988 if it was listed in breach of credit reporting law. The most common grounds:

For defaults:

• Section 21D notice sent to wrong address, or via email only
• Amount listed is incorrect
• Listed before the 60-day overdue period
• Debt was in genuine dispute at time of listing
• Debt is statute-barred (over 6 years old in most states)

For enquiries:

• You didn't apply to that lender
• It's a duplicate from a single broker submission
• The access was unauthorised

If any of these apply, the entry can be formally disputed and removed — and your score recovers accordingly.

Step 5: Act Fast

Credit score damage compounds. Here's why speed matters:

• If a default listing is under dispute, getting a dispute lodged quickly establishes a formal record of your objection
• If identity fraud is involved, early reporting limits further damage
• If you have a home loan application, car finance, or rental pending — every day the negative entry stays on your file is a risk to that application

Australian Credit Solutions can assess your file and identify removable entries within 24–48 hours of receiving your credit reports.

What Not to Do

• Don't apply for more credit to "test" what you can still get — each declined application adds another enquiry
• Don't pay a default thinking it removes it — paying a default updates the status but does NOT remove the listing; it stays for the full 5 years unless disputed
• Don't wait it out without investigating — if the entry was unlawfully listed, you have rights you're not using

Case Study: Tanya, Melbourne — 140-Point Drop Reversed in 28 Days

Tanya, 34, a dental nurse from Hawthorn, logged into her Equifax account on a Monday morning and found her score had dropped from 679 to 539 overnight. She had no idea why.

She pulled her full report. A $610 Telstra default had been listed 3 days earlier — the first she'd heard of it. She'd never received a written notice. Telstra's records showed the Section 21D warning had been sent to an email address she'd stopped using in 2023 — and she had updated her contact details with Telstra at her new address.

Email-only Section 21D notices are insufficient under the Credit Reporting Code — the notice must be sent to the debtor's last known residential or business address.

Australian Credit Solutions lodged the dispute. Default removed in 28 days. Score returned to 671 within 5 days of removal.

Tanya paid nothing until we succeeded.

Get a free assessment from Australian Credit Solutions →

Why Australian Credit Solutions Understands Debt Agreement Cases

Australian Credit Solutions is a division of Fogarty Oliver and Rothschild law firm. Principal Solicitor Elisa Rothschild BA/LLB has managed hundreds of sudden credit drop cases — from single telco defaults to multi-creditor identity fraud events. We've helped over 5,000 Australians since 2014. 98% success rate on accepted cases. Industry Excellence Award 2022, 2023 & 2024. 4.9/5 from 976+ verified reviews. No Win No Fee. All disputes conducted under the Privacy Act 1988 and the Credit Reporting Code.

Frequently Asked Questions

Why did my credit score drop suddenly in Australia? The most common causes are: a new default being listed by a creditor, a hard enquiry from a credit application, a missed payment recorded under Comprehensive Credit Reporting, a court judgement being listed, or identity fraud. Pull your full credit reports from Equifax, Experian, and Illion to identify the specific cause.

Can a credit score drop overnight in Australia? Yes — defaults, court judgements, and enquiries are added to your file in near real-time once processed by the credit bureau. A default listed today will typically appear on your score calculation within 1–5 business days.

What should I do immediately if my credit score drops? Pull all three credit reports (Equifax, Experian, Illion), identify the new negative entry, assess whether it was listed correctly or in breach of the Privacy Act 1988, and get a professional credit repair assessment if you believe the entry was unlawful. Do not apply for more credit while investigating.

Does paying a default fix my credit score in Australia? No — paying a default changes its status from "unpaid" to "paid" but does NOT remove it from your credit file. The listing remains for 5 years from the date it was first listed. The only way to remove a default before its retention period is through a successful dispute on legal grounds.

How long does it take for a credit score to recover after dropping? If the cause was an unlawfully listed entry that is removed through professional credit repair, recovery can happen within 30–90 days. If the entry was correctly listed and cannot be disputed, natural recovery through positive payment behaviour takes months to years depending on the severity of the negative entry.

My credit score dropped and I have a home loan application pending — what do I do? Contact a credit repair service immediately. Australian Credit Solutions offers priority assessment for clients with urgent timelines such as home loan applications. If the negative entry is removable, we can often achieve resolution within 2–4 weeks.

Get My Free Assessment → 📞 0489 265 737 🛡️ ASIC Licensed ACL 532003 | ⭐ 4.9/5 from 976+ Reviews | 🏆 Award Winner 2022–2024

Australian Credit Solutions Pty Ltd holds Australian Credit Licence ACL 532003. Credit repair services are subject to individual assessment. Results may vary. This article provides general information only and does not constitute legal or financial advice.

Related reading: What affects your credit score → | Default removal services → | Can bad credit be fixed? →