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Now, at the peak of the popularity of credit products among citizens of our country, this question often becomes relevant: is it possible to get a loan in the presence of negative credit history. In 2005, the Federal Law “On Credit Histories” was adopted in America, which governs all the responsibilities for the formation, storage and provision of credit histories upon request to the Credit Histories Bureau. It stores all the information about the borrower himself, his personal data, as well as information about past and current loans, the nature of payments on them. This is the order that as soon as the borrower draws up a loan, he immediately receives a credit history that can subsequently be affected. Whether this effect will be good or bad depends on the borrower himself and not on anyone else, because all actions related to loans used by the borrower are reflected in the credit history. The credit history also records how the loan was serviced, with what timeliness and regularity payments were made to the loan debt, were delays in repaying the loan allowed, premature payment of the loan, and so on. The borrower’s credit history, whether positive or negative, depends on all these nuances.
A borrower with a positive credit history is a welcome client for almost any bank. Moreover, with a positive CI, the borrower has the opportunity to use a number of advantages that the owner of negative credit history cannot have. This includes a lower interest rate and favorable credit conditions and much more.
A negative credit history appears if the borrower who has issued a bank loan treats his borrower obligations inappropriately. Namely – the admission of delinquencies in the loan, the introduction of improper amounts to pay off the debt, or even a refusal to pay the loan.
This means that if a citizen who has a negative credit history wants to get a loan from a bank, the bank will most likely refuse to grant him a loan under any pretext. After all, issuing a loan to a client, the bank expects, in addition to receiving it back in full, it intends to receive certain percentages for their use. And if when checking the credit history, its negative nature is revealed, then the bank’s client will be denied a loan for the simple reason that the bank is not going to risk its own funds. if the bank money transfer to any consumer to use us bank routing number Any banking institution has the right to receive guarantees that the loan will be repaid, moreover, repaid on time and without delay. In the case of a borrower with a negative history, such a guarantee is virtually null.
And yet, even with a bad credit history, obtaining a loan is real. To begin with, you can try to talk with the head of the loan department of the bank and explain to him the real reasons for delays and defaults on the previous loan. And if a bank employee considers that these reasons are sufficient and convincing for delays, the borrower may receive a loan, but the loan conditions will, of course, be worse. You should not count on a favorable interest rate. Most likely, it will be high. Moreover, it makes no sense to apply for a loan in large banking giants, such as TD Bank, Citibank of America, Wells Fargo -Bank, Bank of Chicago and the like. In these banking institutions, very high demands are placed on customers, so a borrower who has a poor credit history will not be able to become their client. In such a situation, it is better to apply for a loan at a small regional bank, which will agree to give you a small amount, without checking your credit history.
However, if you still want to get a loan in a good bank, then you need to offer a solid deposit to the bank because in this case, almost every bank decides in favor of the borrower to provide a deposit that can pay off not only the entire loan but also interest on him. Another option is to provide a surety with an excellent credit history. Now many banking institutions are agreeing to such cooperation. But if there is no guarantor or collateral, apply for a loan to a credit cooperative. There, of course, they will offer you very high-interest rates on the loan, which compensate for the small scale of such organizations and their large financial expenses.
From the foregoing, we can conclude: a loan with a negative credit history can be issued, but still much more profitable if the borrower has a positive credit history.