In the lives of most of us, there comes a moment when we most often use banking credit products. How do you get a cash loan if you have never repaid anything before? Is the lack of credit history really problematic for banks? The problem in this situation is quite low credibility with banks, these institutions do not trust clients from the so-called blank card. In the article, we will try to advise you what steps to take at the beginning of your credit path. How to get the cheapest cash or consolidation loans available on the market in the future.
What is the reason for a bank’s refusal to loan if there is no credit history?
Despite stable employment, the client is refused by the bank, why? From the bank’s perspective, there is a risk that the customer will fail to pay. It is completely different when the customer has already recorded liabilities in the repayment history and the bank sees regular repayments. In situations where there is no credit history, banks are able to grant relatively low amounts. If a client applies for USD 50,000, he may be refused only because the bank does not, as a rule, lend people from the so-called empty BIK for such large amounts. It may turn out that the maximum amount is about USD 15,000.
In this situation, it is worth seeking help from a credit intermediary. From among several dozen banks, the client is not able to choose the one who will easily offer him the expected amount. The advantage of advisors’ knowledge is important here, in the case of a client with stable employment amounts for a person without a credit history are up to USD 120,000. As for the refusal, it’s also worth checking your debtors’ bases (KRD and BIG). Many clients forget, for example, about an unpaid fine 5 years ago. It happens that because of such seemingly insignificant things, the bank refuses to grant the customer a loan.
When does credit history appear?
The Credit Information Bureau collects all information about the repayment of our obligations. The institution processes such important information as bank inquiries (in detail on what day for what amount we asked for a loan in a particular bank) and monthly payments of our installments.
If the customer is 2 days late with payment of the installment, BIK will immediately note this fact. So the story appears after 1 month of repayment of any bank liability. However, the BIK score will not appear until 6 months of repayment of such a loan. This appearance of scoring causes banks to treat the customer as someone with a credit history .
It is also worth noting that liabilities from the non-banking sector will not cause credit history, this will only be generated by banking products. Nevertheless, if the customer has non-bank loans outstanding and in arrears, they can effectively prevent obtaining a bank loan .
How do you make a good credit history?
There are many ways to generate a credit history. You can also do it without additional costs. Two good ways are:
- Credit Card – smaller amounts are awarded even without income documents, based on turnover in the account or the fact that we are the bank’s customers. Regulating it in a timely manner does not entail costs and it shapes our credit history.
- Many stores offer loans with 0% APRC, which means that we don’t pay for it. Even if you have money to pay cash USD 100 for an iron, USD 2,000 for a TV set, take these products in installments. This procedure will allow you to get much cheaper loans in the future than those offered without a credit history. Any home electronics product is a good idea here, of course, bearing in mind timely repayments. Setting an automatic transfer order in your account will definitely help.
Young people and bank loan, what is the minimum age to get a bank loan?
The ideal customer for the bank is a 40-year-old couple, both of whom work in a budget, on a contract of employment for at least 4 years without children. Preferably still owning a flat. Perfect clients, however, are rare, which is why banks have to deal with it. A young 20-year-old person is not a dream customer for a bank offering loans, but is still the person on whom the bank can earn. Therefore, the sideburns agree to credit 18 or 19 year olds. It is worth turning to a proven credit broker in this case. Not every bank will accept such a young person.
In some banks, the minimum age of a credit customer is 21 years, in others 19. The minimum age to get a loan in several banks is 18 years. Having an income document confirming the earnings from the last 3 months, the bank is able to agree to credit the customer. It should be remembered that a loan for 18-year-olds will agree at most 3-4 banks out of several dozen. A lot more room for maneuver appears when the customer is 21 years old.
Pensioner and no credit history
What about older people who have never had a need to take credit? How do banks look at such clients? Despite the fact that such persons can have a stable income such as retirement or disability pension, banks do not approach them as clients. To start with, credit offers offer significantly lower amounts than people with a credit history. Banks are wary of clients because they are afraid that they may have had their credit history cleared.
Such a procedure consists in applying for cessation of information processing in banks. The effect is to delete negative entries in the BIK. Banks where the customer did not have loans do not see such a bad credit history. Therefore, banks will carry out extensive verification of older customers who have never had loans before.
Mortgage and no credit history
Shaping your credit history is not so important when applying for a mortgage. In this banking product, the loan is secured by real estate, therefore the bank does not pay so much attention to the lack of repayment history of credit obligations.
Which banks give loans without a credit history?
Basically all, there are no secrets here. If the customer has a confirmed income, he has never had problems with paying his debts, he has no entries in the debtors’ databases, he should get a loan everywhere. These will not be large amounts, banks set different limits for new borrowers, but there should be no problem with the mere fact of obtaining a loan.
If you have questions, please contact our advisers. They will help both young people get a bank loan and the elderly. They will choose the cheapest offer available on the market. For us, a lack of credit history is not a problem.