Key Takeaway
To get a standard home loan from a major Australian bank (CBA, Westpac, NAB, ANZ), you typically need an Equifax credit score of 661 or above (the "Good" band). For competitive interest rates, aim for 735+ (Very Good). Non-bank specialist lenders may approve home loans with scores as low as 500–550, but at significantly higher rates (8–11%+ p.a. vs 6–6.5% for mainstream). If your score is below 661 due to defaults or enquiries that were unlawfully listed, Australian Credit Solutions (ASIC ACL 532003) may be able to remove those entries and improve your score within 30–90 days. No Win No Fee. 98% success rate on accepted cases.
Quick Answer: To get a standard home loan from a major Australian bank (CBA, Westpac, NAB, ANZ), you typically need an Equifax credit score of 661 or above (the "Good" band). For competitive interest rates, aim for 735+ (Very Good). Non-bank specialist lenders may approve home loans with scores as low as 500–550, but at significantly higher rates (8–11%+ p.a. vs 6–6.5% for mainstream). If your score is below 661 due to defaults or enquiries that were unlawfully listed, Australian Credit Solutions (ASIC ACL 532003) may be able to remove those entries and improve your score within 30–90 days. No Win No Fee. 98% success rate on accepted cases.
If you're planning to buy a home in Australia, your credit score is one of the most important numbers in your financial life. Here's exactly what you need — and what to do if you're not there yet.
Minimum Credit Score for a Home Loan in Australia by Lender Type
| Lender Type | Minimum Equifax Score | Interest Rate Range | Notes |
|---|---|---|---|
| Major banks (CBA, Westpac, NAB, ANZ) | 661+ | 5.8% – 6.8% p.a. | Standard home loans |
| Regional banks | 640+ | 6.0% – 7.0% p.a. | May have more flexible assessment |
| Credit unions / mutual banks | 600+ | 6.0% – 7.2% p.a. | Often more manual assessment |
| Non-bank lenders (Pepper, Liberty) | 550+ | 7.5% – 9.5% p.a. | Specialist / near-prime products |
| Sub-prime / non-conforming | 450+ | 9.0% – 11.5%+ p.a. | Much higher cost; short-term solution |
These are indicative thresholds — every lender has their own credit policy and assesses applications holistically. But credit score is the first filter. Applications below these thresholds rarely progress.
What the Rate Difference Actually Costs You
This is the number that puts everything in perspective.
On a $500,000 home loan over 30 years:
| Interest Rate | Monthly Repayment | Total Interest Paid | Extra Cost vs 6.2% |
|---|---|---|---|
| 6.2% (Good credit) | $3,059 | $600,000 | — |
| 7.5% (Near-prime) | $3,496 | $758,000 | +$158,000 |
| 9.5% (Non-conforming) | $4,204 | $1,013,000 | +$413,000 |
A credit file with two removable defaults could be costing you $150,000–$400,000 over the life of your home loan.
What Blocks Home Loan Approval (Credit Factors)
1. Defaults The single biggest blocker. Any default listed on your file — even a $340 telco default from three years ago — will typically push your score below mainstream lending thresholds and trigger automatic declines from major banks.
2. Court Judgements Automatic decline from major banks. Non-bank lenders may consider 2–3 years post-judgement with strong compensating factors.
3. Excessive Enquiries Major banks become concerned at 4+ hard enquiries in 12 months. 6+ in 12 months typically triggers automatic decline.
4. Missed Repayment History Under Comprehensive Credit Reporting, 24 months of payment history is visible. Multiple late payment markers within this period flag repayment risk.
5. Serious Credit Infringements Virtually impossible to get mainstream home loan approval while an SCI is present. Stays for 7 years.
What Doesn't Affect Home Loan Credit Approval
- Your income level (assessed separately for serviceability, not part of credit score)
- Your savings balance (assessed separately)
- Your employment type (assessed separately)
- Your debt-to-income ratio (calculated during application, not in credit scoring)
Can You Fix Your Credit File Before Applying for a Home Loan?
Yes — and if you have negative entries that were unlawfully listed, fixing your file before applying is almost always worth it.
The calculation is straightforward: if fixing your credit file (cost: administration fee + success fee on removal) gives you access to a mainstream loan rate instead of a specialist rate, the saving over 30 years is often $100,000–$400,000. The repair cost is a fraction of that.
Timeline to home loan:
- ACS assessment and dispute process: 30–90 days for most cases
- Score update after removal: 1–5 business days
- Lender eligibility check: immediate
- Home loan application to approval: 4–8 weeks typical
Total from engaging ACS to potential home loan settlement: 3–6 months in most cases.
Case Study: Anika, Brisbane — $312,000 Saved After Default Removed
Anika, 33, a teacher from Chermside, had a $520 Ergon Energy default from 2022 on her Equifax file. Score: 471. She'd been pre-approved by a non-bank lender at 9.1% — the only option she'd found.
She contacted Australian Credit Solutions. The Section 21D notice from Ergon had been sent to a rental address 4 months after Anika had moved out — after the new tenants had moved in. Ergon's records showed her rental agent had provided a forwarding address. Ergon had the updated address and failed to use it.
Default removed in 34 days. Score moved from 471 to 664. Anika applied to Commonwealth Bank. Approved at 6.19%.
On a $480,000 loan over 30 years: the difference between 9.1% and 6.19% = approximately $312,000 in interest savings.
Get a free assessment from Australian Credit Solutions →
Frequently Asked Questions
What credit score do you need to buy a house in Australia? Most major Australian banks (CBA, Westpac, NAB, ANZ) want an Equifax credit score of 661+ (Good band minimum) to approve a standard home loan. For competitive rates, 735+ is ideal. Non-bank specialist lenders may consider scores from 550, but at significantly higher rates.
What is a good credit score for a home loan in Australia? For mainstream home loan approval, 661–734 (Good band) is sufficient at most lenders. For the best available rates, 735+ (Very Good band) is ideal. Anything above 853 (Excellent band) gives you access to every lender and the most competitive products.
Can I get a home loan with bad credit in Australia? Yes — specialist lenders like Pepper Money, Liberty Financial, and Resimac offer home loans to borrowers with defaults, judgements, or low credit scores. The trade-off is significantly higher interest rates (often 8–11%+ vs 6–7% for mainstream). Fixing your credit file first, if entries are removable, is almost always the better financial decision.
How long does it take to fix credit for a home loan? Through professional credit repair, removal of unlawfully listed entries typically takes 30–90 days. Score update after removal: 1–5 business days. Total time from engaging ACS to being eligible for mainstream home loan applications: typically 2–4 months.
Does applying for a home loan hurt your credit score? Yes — every home loan application creates a hard enquiry on your credit file (stays 5 years). Multiple applications in quick succession compound the damage. It's worth getting a professional credit assessment and mortgage broker assessment before formally applying to minimise enquiry stacking.
Why Australians Trust Australian Credit Solutions
Australian Credit Solutions is lawyer-led, ASIC-licensed (ACL 532003), and has operated since 2014. We've helped over 5,000 Australians remove negative credit file entries and access the finance they deserve. Our 98% success rate on accepted cases reflects a simple approach: we only accept cases where we've identified genuine legal grounds. Every case is managed under the supervision of Principal Solicitor Elisa Rothschild BA/LLB (Monash University) — a lawyer, not a call centre. We operate on No Win No Fee: you pay the success component only when we remove an entry from your file. We've won the Industry Excellence Award three consecutive years — 2022, 2023 and 2024. Our 4.9/5 rating from 976+ verified reviews reflects what real clients experience.
All disputes are conducted under the Privacy Act 1988 and the Credit Reporting Code — the laws that govern your rights and creditors' obligations.
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: Credit repair for home loan approval → | Default removal services →
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"Absolutely fantastic service! They helped me remove two defaults that were stopping me from getting a home loan. Now I'm in my dream home. Can't thank them enough!"
"I wish I had found Australian Credit Solutions sooner. They sorted out my credit issues professionally and now I have a much better financial future ahead."
"The team went above and beyond to help me. They explained everything clearly and achieved a great result. I've already recommended them to friends and family."
"Professional, efficient, and they delivered exactly what they promised. My credit score improved significantly and I was able to refinance my mortgage at a much better rate."
Elisa Rothschild
(BA/LLB)Principal Solicitor & Director
With over 12 years of experience in credit law, Elisa has helped thousands of Australians remove unfair credit listings and rebuild their financial futures. She leads Australian Credit Solutions' legal team with a focus on consumer advocacy and regulatory compliance.
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