When applying for a loan, the financial institution will definitely check your credit history. If you want to independently assess your chances of getting a loan, you can contact a credit bureau, but keep in mind that this service is free only once a year.
Why check your credit history?
Lenders check the credit history of a potential borrower before issuing a loan. Evaluation of credit history is one of the main factors when making a decision on granting a loan. This allows the financial institution to understand how faithfully the person will fulfill the obligations assumed. Based on a bad credit history, a financial institution may deny a potential client a loan, despite good income.
If you check your credit history yourself, pay attention to:
1. Current loan arrears.
Even a penny current debt will lead to rejection. Therefore, before applying for a new loan, you should make sure that there are no arrears or, if they have been repaid recently, the information about this has already entered the credit history.
2. Number of open loans.
A borrower’s high credit load is a risk factor from the lender’s point of view. Therefore, you should make sure that repaid loans or inactive credit cards have the contract status “closed”.
3. Correctness of information.
If the credit history contains errors regarding the facts of arrears, information about fraudulent loans, data that has not been updated for more than two months, etc., the information should be contested in accordance with the requirements of the Law of Ukraine “On the Organization of the Formation and Circulation of Credit Histories”