Credit Rating Check – To Analyze the Creditworthiness of Consumers
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Credit rating check is an action taken on the part of a prospective lender to find out if a consumer is creditworthy or not. A thorough analysis is sought from a credit reporting agency or a credit report bureau. Some of the information in the report includes date of birth, current address, current employer, income, loan repayment history, employment history and any other debts. Payment history is usually documented from creditors’ reports to the credit bureaus. It details about timely payment, late payment, and other financial details.
If a credit rating check reveals poor repayment of debts or unfavorable financial situations, loans are refused. In some instances, even if it is approved, the credit limit is lowered or interest rate is increased, or both these are done. While applying for a credit card or loan, or while seeking finance to purchase expensive items, lenders conduct a credit check. Usually, most lenders request for information from a minimum of two sources and make a comparative analysis to check the creditworthiness of the consumer. Equifax, Experian and Trans Union are some of the top bureaus that are established and sought frequently.
Consumers are eligible to obtain a copy of the credit report every month or yearly through recognized bureaus. Free reports are allowed if the consumer is denied credit, employment or insurance coverage. They can also request for a report if the interest rate has been increased in the recent months, by providing an evidence of the situation. A report can also be obtained through a written requisition by mail or on the Internet. It is in the best interest of consumers to keep track of the report, in order to maintain good credit. This helps consumers to ensure that the information in their account is right and identify any mistakes, which in turn helps them receive good rates.
This article was written by admin on October 31, 2011