Wednesday, 02 December, 2020

Banks not looking at the credit rating – the loan is issued


There are many types of loans provided by banks and offered to customers with different names. Regardless of the name, regardless of its intended use; these are all consumer loans. In case of requesting credit, the most important factor; your financial background.

What is meant by the financial past; whether the person has had any problems with the repayments of the credit and credit cards that he has used up to date and whether he has been pursuing legal proceedings due to his debts.

Financial transactions made from past to present are; It is expressed in a more summarized and understandable manner with a credit score.

Credit Rating Steps and Risk Ratios

Credit Rating Steps and Risk Ratios

Banks examine the credit rating to review the applicant’s risk status when reviewing their loan use requests. This note; consists of certain categories in the form of less risky and riskier;

  • 0 – 799 Very risky customer category
  • 800 – 1299 Medium risk customer category
  • 1300 – 1499 Low-risk customer category
  • 1500 – 1699 Good customer category
  • 1700 – 1900 Very good customer category

According to these categories, loan applications are concluded as positive or negative. These notes are also indicators indicating the risk that banks will repay the loan or not. Therefore; There should be no situation or perception like banks not looking at the credit rating.

Credit Note may Be Learned From?

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While credit ratings can only be queried by banks and financial institutions in previous periods, today, individuals or organizations have their own credit ratings and more detailed financial reports if they wish; they can learn from Good Finance against the service fee. Good Finance is a service offered by the Credit Registration Bureau.

Can Low Credit Rating Be Upgraded?

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It is possible to increase the low credit rating over time. But first of all; If there is any old credit or credit card debt, it must be paid. If necessary, restructuring of old debt may be requested. Therefore, applying to the bank and creating a new payment plan according to the current conditions generally yield positive results. This is also; It is a refreshing and positive step with the bank or banks worked. After the old cleaning is done, the steps to be taken to increase the credit rating;

  • Keeping money in the bank account and increasing it over time,
  • There is no delay in the use of credit cards of the bank and reimbursement,
  • Giving regular payment orders for regular invoices,
  • The Bank’s; Utilization of other services or products other than credit or credit card will cause the credit rating to increase for a while. When this stage is reached, loan applications can be approved more easily and smoothly.

Banks Not Looking At The Credit Rating

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Customers with low credit scores are a risky group for banks and cannot easily respond to loan applications easily. But it is not completely impossible either. According to the situation and re-evaluations; banks that lend a low-risk credit rating, or banks that lend 800 points. However, the bank may make additional requests for this, making the approval conditions more difficult.

Banks Approving Low Credit Rating

Banks Approving Low Credit Rating

In loan applications of those in the low or risky group, in order to minimize the risk for the bank; may change the loan terms and request additional guarantees. These can be listed briefly as follows;

  • Real estate or securities collateral and mortgages may be requested from those requesting loans.
  • It may be requested to show a proven guarantor that the income or financial situation of the loan is good.
  • Approval can be given for some of the loan amount requested instead of the whole amount.
  • Credit term, that is, the payback period; can be kept shorter than requested.
  • Changes can be made to the loan interest rate.

The discretion of examining, approving or not approving the credit requests of the persons in the risky group may vary according to the banks. Therefore; It is impossible to give an exact answer to the question of which banks are lending to the bank with a bad credit record.

However, as it is known, taking credit; It can also be made from other financial institutions other than banks. But in general, the credit given by such financial institutions may have a purpose or condition of use; such as car loan, home loan, store spending loan.

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