| Are you thinking of getting a loan from the bank but | | | | you have a good score. They would not want to run |
| you don't know whether or not you will qualify? Are | | | | the risk of your defaulting on your loan, which would |
| you worried that you might get turned down for a loan, | | | | require them to take you to court or to pay a collection |
| and you fear the embarrassment to yourself? I would | | | | agency to recover their money--costly actions they will |
| say that you need to get a clear picture of how a | | | | only take as a last resort. |
| bank would decide whether to accept your loan | | | | So, it's clear that the bank will decide if you qualify for |
| application or not. Perhaps knowing how you can get | | | | a loan based on your credit score. You may be |
| approved will reassure you. | | | | wondering how the bank is able to learn your credit |
| In general, if you want to qualify for a loan from the | | | | score in the first place. Well, it is important for you to |
| bank, you will need to have a good credit score. Let | | | | realize that most of your financial transactions are a |
| me help you understand what that term means. | | | | matter of record, and everything you may do--apply |
| Basically, a credit score is a numerical rating of your | | | | for a loan, get a credit card, open a new bank account, |
| credit worthiness. Now, how does it apply to getting a | | | | rent an apartment, purchase a car--is tracked by |
| loan from the bank? | | | | financial institutions. This information can be compiled by |
| Well, the bank will look at your credit score to find out | | | | a credit reporting agency into a credit report, and used |
| whether you would make a good debtor. The score | | | | to calculate your credit score. The bank is then able to |
| tells it whether there is any risk involved in lending you | | | | purchase your credit report from one of the credit |
| money. If you have a poor score, that indicates a | | | | reporting agencies. |
| greater risk that the bank will not get paid back the | | | | Your financial life is an open book, and your local bank |
| money lent out to you. On the other hand, a high credit | | | | has access to it. If you want to qualify for a loan at |
| score will tell the bank that you are more likely to pay | | | | your bank, you had better make sure your "book" |
| back the loan along with the corresponding interest. | | | | presents you in a good light, financially. |
| The bank certainly will prefer to approve the loan if | | | | |