HOW TO IMPROVE THE CREDIT HISTORY?
Many people have repeatedly heard about credit history, however, not everyone knows what is hidden under this name. Especially often people could hear about credit history, who for some reason could not repay the debt to the bank.
Since bank employees and collectors very often threaten the deterioration of credit history in the event of the refusal of immediate repayment of the overdue loan. However, and people who without a problem paid one or more loans, could hear about the credit history, but in this case without any threats.
What Is Called A Credit History?
In fact, the credit history is a short description of a person as a borrower. Thus, the credit history tells how many people took loans, how they paid them, whether they had delayed payments or other violations, whether they had successfully repaid the full amount of the loan and other information related to the person’s relationship with banking institutions. Getting a loan with a bad credit history becomes incredibly difficult. It is noteworthy that all credit histories are stored in a special institution of the Bureau of Credit Histories, which has been operating in our country recently.
Although banks often mention good or bad credit history, there is no such terminology by and large. The credit history does not contain any criticism or other comments. It contains briefly presented data that does not have any description. About what a credit history is, the bank itself judges, given the number of positive and negative points. Naturally, if such a document indicates that the borrower returned all loans on time, without allowing any violations, its credit history will be considered positive or even ideal. However, when there are more negative moments than positive, the borrower’s history is considered bad, negative or spoiled.
How Do I Clear Or Fix A Credit History?
Very often you can see or hear questions about whether you can fix or re-write your credit history. In fact, such a document can not be overwritten, erased or cleared. It starts at the moment when a person makes out his first loan and is supplemented throughout his life. However, it is still possible to correct a spoiled credit history. At once it is necessary to say that this is a rather protracted process, which will require a considerable amount of time.
Naturally, banks will not want to issue a lucrative loan to a borrower who has not yet paid out previously issued loans. Therefore, the first step to improving the credit history is the repayment of all overdue loans, even if banks have long ceased to require allocated funds. If the credit history indicates that the borrower has no outstanding loans, his credit history will no longer be irreparably corrupted.
Next, you need to issue a few new loans, so that you have an opportunity to prove yourself as a good and faithful borrower. Of course, new loans need to be paid on time and in full, avoiding late payments. However, do not expect that banks will give credit to the owner of a bad credit history on favorable terms. Most likely, he will be offered a high interest rate, fairly strict penalties and a short loan period. However, quite a few unprofitable loans, for example, to buy a phone or an electric kettle, so that the credit history is much better. Gradually banks will offer more favorable conditions of crediting. And after some time, no one will remember the mistakes made before: the credit history will be considered good.
Is it possible to issue a loan with a spoiled history of cooperation with banks?
It’s time to return to the main topic of this article, about how you can get a new loan with a negative credit history. First, you can use the above option and improve the document on cooperation with different banks. However, this option is suitable only if the time limit for obtaining credit funds is not tight.
Secondly, you can apply to a non-banking organization and get a loan. As a rule, loans are issued without checking the credit history, as they are accompanied by huge interest rates, as well as rather strict penalties. By and large, such a microcredit can be obtained even on a passport, without wasting time on the preparation of certificates of employment, income received, and so on.