Poor Credit Rating

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If you’ve been turned down for a credit card, it could be because you’ve paid off so perfectly that you have no credit history. But your credit rating is poor and it could be difficult to get credit at a price you find attractive.

A Poor Credit Rating

People get a poor credit rating if they have defaulted on payments in the past, they have been bankrupted, they have paid bills late and they have had CCJs against them.

CCJs stay on a credit file for six years, and it is difficult to get credit if these are the problem

Banks, credit card companies and store card issuers also check people’s credit report. Credit reference agency can maintain the detail of people’s applications and approvals for credit, borrowings, payment record and electoral roll entry. Equifax and Experian are two of the best known credit reference agencies.

The Affect of Poor Credit Rating

It makes it difficult to get a loan, credit card, store card or mortgage. Even if people manage to get these products, they advantage from the same low rates and incentive offers. Instead, they may have to pay a higher interest rate, either permanently, or until they show a good record of payments on the credit card or loan. As an example, a person with an excellent credit rating could borrow money at a 6%. Interest rate and a person with a poor credit rating might in 25%.

Loan Options for People with Poor Credit Ratings

People with poor credit ratings have the option of loan that is secured loan. There is also the option of a prepaid credit card and that is similar to a prepaid mobile phone card.

Improvement in Your Credit Rating

It is a simple procedure. Pay your bills on time. Finally, get a copy of your credit file from credit reference agency to make sure the details are correct.