Applying for a mortgage is a big financial step, especially in New Zealand’s competitive housing market. One of the most important things lenders consider is your credit score. Whether you’re a first-home buyer or looking to upgrade, improving your credit score could make a significant difference in getting your mortgage approved—and securing a better interest rate.

What is a Credit Score?

Your credit score is a number that reflects your creditworthiness, typically ranging from 0 to 1000. It’s calculated by credit reporting agencies like Equifax, Centrix, and illion, and is based on your financial behaviour—things like bill payments, loan history, and even how often you apply for credit.

Generally:

• 800+ = Excellent

• 700–799 = Very Good

• 500–699 = Average

• Below 500 = Below Average

Lenders use this score to gauge how risky it would be to lend you money.

Why Your Credit Score Matters for a Mortgage

A higher credit score can:

• Improve your chances of getting your mortgage approved

• Help you qualify for better interest rates

• Give lenders more confidence in your financial habits

7 Tips to Boost Your Credit Score Before Applying

1. Check Your Credit Report

Start by requesting a free copy of your credit report from https://www.mycreditfile.co.nz/  Check for errors like:

• Incorrect payment defaults

• Outdated information

• Accounts that aren’t yours

If you spot anything wrong, dispute it with the credit reporting agency.

2. Pay Bills on Time

Late payments—even for your phone or power bill—can hurt your credit score. Set up automatic payments or reminders to ensure you stay on top of all your bills.

3. Lower Your Credit Card Balances

If you’ve got credit card debt, try to pay it down. High balances (especially close to your credit limit) can negatively affect your score.

4. Limit New Credit Applications

Each time you apply for credit (including hire purchases or store cards), it shows on your report. Too many applications in a short time can make you seem financially stretched.

5. Keep Old Accounts Open

The length of your credit history matters. If you’ve got an old credit card with a clean payment record, keeping it open (even if unused) can be beneficial.

6. Avoid Payday Lenders

Lenders tend to view payday loans or quick cash loans as a red flag. If you’ve used these services, it might be worth waiting a few months and showing consistent financial stability before applying for a mortgage.

7. Show Consistent Income and Savings

While this doesn’t affect your credit score directly, banks in NZ look for financial consistency. Regular income and a history of savings show you’re mortgage-ready.

8. Avoid buy now pay later

Using facilities like these do not demonstrate good money management and planning

Improving your credit score isn’t something that happens overnight, but with a little planning and discipline, it can make a big difference when you’re ready to approach a bank or broker. If you’re serious about buying property especially in cities like Auckland, Wellington or Christchurch, preparing your credit profile is one of the smartest first steps you can take.

Pro tip: Talk to a mortgage advisor or broker early—they can give you personalised tips based on your financial situation.

Need help getting mortgage-ready?
Contact us—we’re familiar with local lending rules and can guide you through the process.