Your credit score indicates to your bank whether your past debt repayment behaviour will make you a good risk or not. Through various calculations based on your transactional records, the credit bureau will provide your bank with a three digit number ranging between 0 and 999. Naturally, the higher the better, and a high credit score rating is one of the most valuable personal finance assets you can have.

Generally speaking, a score of 600+ will give you a fair chance of home loan approval. Although this may vary according to which bank you use. Each bank uses both the Credit Bureau score and their own internal risk assessment criteria which looks at a number of factors specific to a particular home loan application, such as the loan size compared to the property value (zero deposit is considered higher risk). If you are classified as very high risk, the chances are you won’t be successful in your home loan application as the banks will question your ability to pay them back. A good to excellent credit score will have the opposite effect, possibly opening the way for you to negotiate preferential terms and interest rates.