According to MyCRA Lawyers CEO Graham Doessel, the new comprehensive credit reporting laws mean banks “now know so much more about everybody and their financial matters”.

This includes “when they buy a new phone and how they buy it, which could be enough to ruin their credit rating and see them rejected from borrowing to buy a home”.

Often when you apply for a new phone, the telco will do a credit check which shows up on your file.

Mr Doessel said even if you buy the handset upfront using a buy now, pay later service, some of those will do a credit check as well.

He commented that “once you have a few of these in a short period on your credit file, you run the risk of being rejected outright for a home loan”.

According to the CEO, “some lenders treat buy now, pay later services the same as payday lenders, which means an automatic rejection”.

But the issues don’t stop there.

“If you sign up to an expensive contract with the cost of the handset rolled into your monthly bill and you start missing payments, chances are your telco will default you,” Mr Doessel continued, noting telcos as “one of the most common causes of defaults on a credit file”.

“While a default won’t necessarily rule you out of getting a home loan, it will certainly be enough for your bank to see you as a risk and therefore apply a higher interest rate, which may price you out of the market.”

Even more worryingly, the CEO said shopping around for credit – whether it be a buy now, pay later lender, credit card deal or other personal loans that require a credit check – “can see you ruining your credit score in a matter of days and lock you out of a housing market for two years or more”.