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How Does Harmoney Check My Credit Score, and What Impact Does It Have on My Application?

  • Writer: Harmoney
    Harmoney
  • 17 hours ago
  • 3 min read

A credit score is a crucial part of any loan application, and it's natural to be curious about how it's used. At Harmoney, we believe in being transparent about our process so you can apply with confidence. We use credit checks as a key part of our responsible lending assessment, and we do it in a way that minimises the impact on your credit score.

Our process involves two types of credit checks: a soft credit check and a hard credit check.

Step 1: The Soft Credit Check (For a Quote)

When you first use our website to get a personalised, no-obligation personal loan quote, we perform a soft credit check.

  • What it is: A soft credit check gives us a high-level overview of your credit history. It is often used for background checks or to pre-qualify you for a loan.

  • The Impact: A soft credit check has no impact on your credit score. It is not visible to other lenders, so you can get a quote and see your potential interest rate and loan amount without affecting your credit rating.

  • What it tells us: This allows us to quickly assess your creditworthiness and provide you with a guaranteed interest rate.

This initial step is designed to empower you with information, helping you make an informed decision before you commit to a full application.

Step 2: The Hard Credit Check (For a Full Application)

If you are happy with your quote and decide to proceed with a loan application, we will perform a hard credit check as part of our full review.

  • What it is: A hard credit check is a detailed inquiry into your credit history and is a formal part of the lending decision process. It provides a more comprehensive view of your financial behaviour.

  • The Impact: A hard credit check will be recorded on your credit file and may temporarily cause a small dip in your credit score. This is normal for any loan application.

  • What it tells us: This check confirms the information you provided and allows us to make a final lending decision based on a full picture of your finances.

We will only perform this hard check with your explicit consent after you have received your quote and confirmed that you wish to proceed with a loan application.

How Your Credit Score Impacts Your Loan Application

Your credit score is a number that represents your creditworthiness. A higher score generally indicates a lower risk to a lender.

  • Approval: Your credit score is a major factor in whether your loan application is approved or declined.

  • Interest Rate: A better credit score can often lead to a lower interest rate, as it demonstrates that you are a reliable borrower.

In New Zealand, credit bureaus like Centrix, Equifax, and Illion (owned by Experian) collect and report credit information. Harmoney works with these agencies to get the information we need to make a fair and responsible lending decision.

How to Improve Your Credit Score

If you're concerned about your credit score, you can take steps to improve it.

  • Check your credit report for free with a credit bureau like Centrix or Equifax.

  • Make sure you pay all your bills and debts on time.

  • Avoid making multiple applications for new credit in a short period.

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