Get your Credit Report in Order! Why Creditors Refuse Bad Credit Customers

When we urge applying for a loan, we consider the bill payment emergency and the ease of taking out the credit. Thus, many millions of Americans select payday loans as they are extremely fast and easy to get. Even a borrower with poor credit score can get a loan, but with much higher interest rates than responsible and reputed bank customers. Therefore, get your credit report before applying for a loan and estimate your chances to have good payback conditions offered.

Credit Report Basics

According to WiseGeek, credit reports are the documents that contain complete borrower’s credit history. If you had unfavorable borrowing experience such as mortgage delays, credit card denials or even a bankruptcy, all of this information is specified in the credit report.

When you apply for a loan, you provide the selected lenders with the authorization to see you credit report. Thus, responsible loan officers check your credit history and the score easily, estimating your chances to pay the debt back on time.

The documents are provided by 3 authorized agencies in the USA:

  • Experian;
  • Trans Union;
  • Equifax.

Thus, it’s recommended to get your credit report in beforehand from one of these companies, check it carefully for errors and inaccuracies and correct the information.

How to Get You Credit Report?

FTC (the Federal Trade Commission) recommends all American citizens to check their credit reports once a year, at least. It helps you to prevent an identity theft and to check the information for mistakes.

Thus, to get the document online or by mail:

  • visit the annualcreditreport.com website;
  • fill out the form;
  • select one of the 3 credit report agencies to contact;
  • verify your identity;
  • view the report online.

When you fill the form up, you are to specify your personal data, such as the birth date, previous and current addresses, your social security number. Additionally, you may be asked some questions to confirm who you are.

Commonly, every document contains 81-month credit history. But every authorized agency’s procedures have some distinctive features. For example, Experian reports not only the delayed, but also the on-time loans. TransUnion provides the most updated employment and contact information.

So, get the credit report and review it for errors. If any inaccuracies are discovered, dispute it online or by sending the copy to the agency or directly to the bank. When the credit bureau’s account information is updated, apply for a loan and wait for an approval.

Why Creditors Refuse Applications?

When you apply for a credit from a bank or a credit union, you can get a refusal, if:

  • you are applying for too many credit cards at once;
  • your credit card balance is very high;
  • your income is low;
  • your credit history is bad.

Meanwhile, applying for a payday loan, you have more chances to get it even if your credit record is bad. You can get a refusal, only if you are:

  • younger than 18;
  • not an American resident;
  • don’t have any steady income source.

That’s why many low-income borrowers apply for payday loans and the latter are still very popular. Ability to get them fast and easily even if the credit score is low attracts multiple customers that need the money urgently and at all costs. Thus, the lenders undertake the risk that is pretty high by compensating it with high-interest rates.

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