People who avoid credit obligations often think that a lack of credit history is an advantage. They think that having a completely clean account, if necessary, they will easily get a bank loan. However, it may turn out that when they finally decide to take the first loan in their lives, despite stable employment and a clean history, they are refused! Why ?! It’s simple, banking institutions do not trust clients with a blank card, because the complete lack of credit history creates the risk that the client will prove unreliable and will not pay off their commitment. Therefore, it is said that it is better to have a short history in the Credit Information Bureau than they do not have it at all. Is the lack of credit history really a problem for banks and loan companies? How do you get a loan without a credit history?
No credit history. What does it affect?
Credit history assessment is one of the most important stages when verifying a customer who is applying for a loan. The Credit Information Bureau collects all information about repayment of liabilities. On the basis of the history recorded in the BIK, the bank obtains information on what obligations the customer had before, whether they were repaid on time and, above all, whether the person is reliable and the borrowed funds will be repaid. If we already have a positive repayment history, we increase the chance of another loan and we will probably get it on better terms!
People who have never used banking products, did not take loans or did not pay in installments, do not have a credit history in the BIK register. In this situation, the bank does not know what to expect from such a person. He does not know if there may be delays and whether he can count on loan repayment at all! Such a person, even despite high income, will be perceived by the bank as an unreliable payer. For a bank, a client who has a short credit history is more reliable and valuable than a client who has a history. Therefore, the lack of credit history is often a problem for young people who, because of their age, have not yet had any obligations and would like to take out a loan.
That is why building a credit history in BIK is worth starting as early as possible. First of all, because it is a difficult and time-consuming challenge. Is it even worth building your credit history at all? Definitely yes! Even the purchase of any equipment in installments will result in an entry in the register. The bank, seeing the history of regularly paid liabilities, is much more willing to grant a loan. It is worth remembering, however, that for banks the most important thing is a positive credit history, not just any.
Is credit without a possible credit history?
If we have never had any financial obligations and have no credit history, we are wondering: Will we get a loan without a credit history? Is a loan without a credit history possible?
Yes! Both loans and loans without a credit history are possible! As long as we have a source and regular source of income, we should get both a loan and a loan.
With a clean credit history, you can get a loan from a loan company.
The credit history is most important for commercial banks, while for loan companies it is usually enough to have no negative entries in BIG or KRD. Loan companies are ready to take a higher risk than banks and credit unions, because they grant loans from their own capital, and the risk increases from an empty BIK register is compensated by higher service costs. The offer includes loans even for very young people, thanks to which the non-banking sector can be a good way to build a credit history.
In the case of banks, it may be a bit harder, but they also grant loans to people with an empty BIK. Most often, however, these are initially low amounts, eg USD 15,000, because they are afraid to lend large amounts to such people.
However, in the case of a mortgage, the client is verified in several stages. Each lender has its model profile of an ideal candidate, to whom we are compared based on the information contained in our application.
The following are taken into account:
– credit history
– the applicant’s current assets
– type and amount of income earned
– employment period with current employer
– relations with financial institutions (eg having a bank account)
– type of household (marital status)
Therefore, your credit history is just one of many elements, which is why its lack does not mean that you don’t have a chance to get a mortgage, especially since each bank has a different profile of the target customer! However, such as a customer often incurs higher costs and additional fees, just before you decide to take out a mortgage, it is worth first building your story with the help of loan companies.