When you default something, it means you have failed to make repayments. Defaults can have severe negative impacts on your credit score, which is important for obtaining loans and other forms of credit. Defaults are often preventable with careful planning, and when all else fails, negotiating with your credit lending agency. Continue reading
Credit limit can be quite a dilemma at times. Both, having too much credit and not having enough credit limits can be equally troublesome. Credit limit is the credit amount in which a financial institution such as a bank or private creditor extends to a customer. A credit limit on a credit card is the maximum amount the card company is willing to allow the card holder to spend on that specific card or cards linked to a single account. Continue reading
Late payments lead to bigger debts and worse credit histories that lead to very bad credit scores. Needless to say that bad credit scores lead to the possibility of the related individual not being able to secure future loans. The point being driven home here is that you should keep up with repayments of credit cards, loans and mortgages to avoid getting into a debt trap and also save yourself a whole load of cash in the process. Continue reading
It is imperative for everyone to have a clean credit history. This is true because one never knows when the need for a loan may arise. This need may stem from the fact that you need to buy a house, refinance your existing mortgage, apply for a credit card or get a money loan to meet some emergency financial need. Continue reading
A clean credit history guarantees future finance such as loans, should you ever need one. What is more, a bad credit history will definitely be a hindrance or a guarantee for you not getting a loan, or even if you do, you will be expected to pay a high rate of interest – and all because of your bad credit history. So, it is important for everyone to understand the benefits of maintaining a clean credit history. Continue reading
You probably already know what “credit history” is. However, lets give the initiated a concise explanation before we proceed. Every time you fail to make a payment on a credit card, loan or in some cases, fail to pay your bills, your creditor reports the missed payment to the credit bureaus. The credit bureaus calculate your monthly credit score based on these reports from creditors and display it as a three digit number. The lower the number, the worse your score is, meaning that, your creditworthiness is nothing to be proud of and that you cannot be depended on to repay your debts. Who then would want to lend you money? Continue reading
In terms of “Credibility,” credit can be defined as a lenders confidence in a borrower’s ability to repay loans. Credibility is thus also synonymous with ones reputation of being trustworthy to keep commitments. Therefore a credible person will find it easier to borrow money to pay for goods, services or anything he, or she needs the money for.
Over time, credit has also come to refer to amounts of cash that has been loaned to an individual or business firm. Continue reading
An important tip which you ought to know for improving your credit rating is responsible handling of your credit card, as they are known factors for affecting your credit immensely and is one of the most common causes of bad credit.
How Credit History Is Important both For Borrowers and Lenders
Before we understand the importance of credit history from the perspectives of borrowers and lenders, it would be better to have a good idea as to what credit rating or credit history is all about.