Now banking organizations are required to check the credit history of potential borrowers before approving a loan. If this person has a bad reputation, he is refused. And then the question arises: how to improve credit history, if it is damaged? This article will tell you how to do it for free or at a low cost.
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To find out whether you can correct your credit history and choose the best way to do this, you need to know about the reasons for which the borrower received unfair status. Each bank examines the creditworthiness of customers, guided by various factors. However, undesirable entries that spoil the credit score can be conditionally classified based on the severity of the violation:
Small delay payments up to 5 days. For most organizations, this is considered the norm, but some banks are able to refuse to issue a loan even with such a minor violation.
Repeated delays in loan installments or single delays for a period from 5 to 35 days. This is considered an average violation that may affect the decision of the bank.
Partial or full loan default is a gross violation. If it comes to recovery of debt through the court, the borrower receives the status of a malicious defaulter and loses the opportunity to take new loans.
Information about loans is stored in the databases of credit score. It displays information about ever taken loans, their payment and there were delays. To clear a credit history, it is necessary to find out if unfavorable information about delinquencies or debts is recorded there. There are several ways to get a documentary report on the history of loans:
Fill out an application via the Internet and confirm your identity by sending a telegram to the postal address of the bureau or by contacting the office of the organization in person.
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By law, every citizen has the right, once a year, to receive a free report from a credit score. If the borrower does not know in which bureau his business is kept, then first he will have to request it at the Central Clearing Center (Central credit score Catalog). It is sent through a credit score, a bank, a post office or a notary. If the process of issuing a credit score needs to be accelerated, then it is better to apply for a paid service of obtaining a credit report to any bank or reliable agency, cooperates with the credit score.
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How can you improve your credit history if it is damaged due to the fault of the borrower? The only way is to convince creditors of their willingness to fulfill their financial obligations by restoring their status as a bona fide client. For this, it is necessary that marks on timely payments on loans appear in CI. This can be achieved only through proper payment of subsequent loans.
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Credit brokers call at once several ways to get a loan with a bad CI. However, before proceeding actively to update its debt history, it is necessary to deal with the existing delinquencies.
Taking new loans without repaying the previous ones is a direct path to creating an unbearable financial burden. In addition, a borrower who has several overdue debt is more difficult to restore his reputation.
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Unable to recover credit history with outstanding debts. You can not hide from creditors or ignore their requirements. So you only aggravate your reputation and provoke banks to take decisive action to collect debts.
How to get a loan with bad credit Kansas?
Credit experts recommend borrowers with long arrears on loans to act according to the following scheme:
To repay the smallest loans – loans, credit card debt or overdraft. Such debts are characterized by high interest rates and fines, and banks are often transferred to collectors.
Seek restructuring for other loans. This should be done even if there is a delay. Even if the bank refuses to restructure the debt, the borrower will have documentary evidence that he has conscientiously tried to solve the problem, that is, a victim of circumstances, and is not maliciously evaded by the non-payer.
Try to reduce the amount of debt. If the delay arose long ago, the loan amount could greatly increase due to penalties and fines. Having such a structure of debt, it would be wiser to contact a lawyer who specializes in credit matters. The specialist will analyze the situation and help partially or fully zero the penalty imposed by the bank.
When collecting a debt in court, ask the court to postpone or installment. Having the opportunity to repay the debt in parts according to a convenient schedule or winning time, it will be easier to cope with credit obligations.
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Be sure to keep all documents related to your credit affairs, such as credit card reports, credit payment checks and any other. All of this can help you analyze the state of your financial affairs and understand where you made a mistake, how to serve as evidence of mistakes made in a credit report. Try to reduce your monthly expenses. Thereby you can repay any existing debt, and one step closer to improving your credit rating.