If we asked you about the most important documents of your life, you will probably talk about birth certificates, driving licenses, passport, and property/car ownership. You will probably even list certificates for asset holdings like stocks, time deposits and more. However, you will always forget the most important document- your credit report.
What is a credit report?
To put it simply, it is a document that states your relationship with debt. It could detail the last 3 years or more of your debt history and tell a lender whether you are a good candidate for loans or not. The report is usually distilled to three digits- a number that runs from 350 to 850. A score over 700 is considered is considered good for disbursing loans. However, a score below 500 is generally considered ‘bad credit’.
The credit score shows how likely you are to pay back the funds you have been given. In essence, it judges you on the basis of your debt history- when did you take debts, did you repay on time and how exactly you managed to keep your standing high even with lurking debts.
What does the credit report include?
Your credit report includes all the current and past loans that you have taken. It will include details about the payments that you have made throughout this time. The most prominent features of these reports include the unused lines of credit and the loans that you are currently furnishing. These present the most relatable and current state of your finances with ease. It will include all your required monthly payments (including the minimum payable for your credit card).
If you ever declared bankruptcy, insolvency, or foreclosure in the past, it will be added to this document. If you have defaulted on any loan payments or if any debts are in collections, they will be added very prominent to your report.
Why does the credit report matter so much?
One late payment and your credit report could be screwed for the next 1 to 7 years at least. This means that getting a loan will become extremely different. If you have a good score, you can get loan from anyone or anywhere. However, those with bad credit have to stick with subprime lending. In this sector, only a small number of lenders command respect. One of them is Payday Pixie. You can get quality bad credit loans from here at reasonable interest rates.
What if you don’t have a credit report?
In the current state of affairs, it is impossible not to have taken a loan. If you don’t have a credit report yet, you can get it from a credit bureau. They can provide you a report for free. Their work is to collect all public records as well as repayment records from lenders and use their respective formulas to determine a credit score for you. The report can also be available online. You just have to furnish your basic details and it will be done.
Do you have the most important document of your life yet?
Author: Oliver Curtis
Hi there. I’m Oliver. I’m just a young boy from the outskirts of… Okay, that’s a lie, I’m not a young boy anymore, although I certainly feel that way at heart.