How to check your credit standing?

Creditworthiness is one of the most important parameters that the bank checks before granting any loan. If our ability is small or even we don’t have it at all, we can forget about the financial support of the bank.

Fortunately, knowing whether there is creditworthiness at all and how to influence it before we go to the bank, we can prepare ourselves for it. You have to start by answering the question, what is credit standing? In the simplest terms, it is our ability to repay the commitment. Before the bank gives us any amount, it will estimate whether we will pay the installments on time.

Calculation of creditworthiness

Calculation of creditworthiness

The answer to the question of how to calculate creditworthiness is not quite simple at all. It consists of many factors and independent calculations will not be so reliable that they show exactly the same values ‚Äč‚Äčthat will come out at the bank. However, you can use ready-made tools available on the web. We need to fill in a few headings in them, and eventually the approximate amount that we can apply for will be shown. It will also be a hint on what bank employees will focus on. Among the data necessary for calculations is the household’s net income, the number of family members, the sum of fixed expenses, the sum of monthly installments and other obligations, the time for which we want the loan and the interest rate.

If we are determined that we will apply for a loan and want more professional help and think how to check creditworthiness, we can turn to a professional financial advisor for help. He will tell us exactly what will affect our credit standing in our case. His knowledge will go far beyond a simple calculator, so we can be sure that his calculations will be more similar to those that will come out at the bank.

When is it not worth checking your creditworthiness?

When is it not worth checking your creditworthiness?

First of all, when we know that it does not look good. And this is exactly the case if our name is in the BIK debtors database. This is the first place where the bank will check us. If we are unable to meet the deadlines of existing commitments, it can be suspected that the new installments will not be repaid on time. So before we start calculating creditworthiness, let’s check the BIK.

It is also known at the outset that our creditworthiness is questionable if we do not have a stable source of income. We can talk about this situation when we work under an employment contract for less than 3 months. However, economic activity must be carried out for at least a year. Sometimes there are such paradoxical situations that a person who has income of the order of several or several thousand a month, goes from bank to bank and cannot get a loan.

What affects creditworthiness?

What affects creditworthiness?

When we know how to check creditworthiness, we can go a step further. Just because the calculations do not quite show what we would like does not mean that it will always remain this way. There are a number of ways to improve your credit standing. The first thing we can do is to improve the situation in BIK. Knowing that we will need bank support in the near future, it is not worth delaying. Once every six months, anyone can generate a free report about themselves. If there are any arrears or liabilities, we should settle them.

BIK also has its advantages. If we already have a loan or shopping in installments, which we always pay back on time, it is a signal for the bank that we are a reliable customer. Interestingly, the lack of any entries in the BIK works to the disadvantage. This is often a problem for young people who have never taken installments. The bank knows absolutely nothing about whether we pay back or not, so it will exercise caution. Insofar as small installment purchases (in a small amount) will favor us, credit cards, overdrafts and revolving loans, not necessarily. They show that we have a problem with maintaining liquidity and financial stability.

Another way to improve your capacity – the second borrower. If two people take the loan, for example a marriage, then the creditworthiness will be greater. This is a great security for the bank. If one person is unable to pay the installment, it can be enforced with the other person.

Consider a longer loan period. If you want to take a loan for a long time, you may find that our credit standing is much greater. Again, this is due to the bank’s security and, of course, its profit. A longer period means a higher commission, moreover, the installments will be lower, so there is a higher probability that they will be paid on time. Fixed installments are also more favorable in this respect than decreasing ones.

When you apply for a mortgage, huge money comes into play. Then you also have to take care of your creditworthiness even more. And that includes gathering more of your own contribution. Most often a minimum of 10% of the property value is required, but this involves high costs and lower capacity. It is best to immediately assume that we collect until 20% accumulates and we get much better conditions.

Time to get a bank loan, how soon to get a loan?

Searching for a good and cheap loan by a layman, a person who is not a specialist in the subject can be difficult. The multitude of dozens of banks, various offers tailored to specific customer categories can be frightening. Well, how do you know that if you work in a budget, then the cheapest loan will get in bank A, and running a business from 7 months will get the best offer in bank B. Doing some research, comparing banks’ offers, choosing the cheapest takes a little time. Another time consuming matter is submitting the application, its analysis and final talks with the bank about the offer.

This usually takes a week. A lot of time for someone who works every day, takes care of the family, home. Therefore, it is much simpler to use the help of a loan broker who has adequate knowledge in the field of bank loans. The entire procedure from the time of reporting to the loan broker to the launch of the loan is usually 24 hours. Do you want to shorten the time to get the loan? we invite you to read

Best offer, finding a bank

Best offer, finding a bank

The first problem in looking for a bank loan, be it cash or consolidation, appears at the beginning of our path. Is the bank around the corner is certainly the best choice and we will get the cheapest offer there? The most important thing, do not walk on banks, do not make unnecessary queries. This may later result in denials of loans. Search by comparing bank offers. Each of them has the obligation to disclose the terms of their loans.

Pay attention to factors such as APRC, loan interest rate, commissions and margins. See also whether the bank must attach insurance to the loan. Think, is such insurance necessary? If you want to protect yourself, have an additional product for credit, which is insurance, definitely cheaper will go to an insurance company.

Insurance companies with which banks cooperate usually sell expensive insurance. In popular insurance companies, customers get 50% cheaper offers than those imposed by the bank. The time to get a loan will not be reduced by looking for yourself, but we are sure that we have chosen the cheapest offer.

Comparison of bank loan offers

Comparison of bank loan offers

The internet is full of credit comparison websites. In such a calculator, it is worth answering a few questions in accordance with the facts and bring out 2-3 banks that should give us the most attractive offer. Why should they Because we are not sure that it will be so. If bank A publishes data on its offers, APRC 11%, including a detailed description of interest and margins, this is only a general view. Banks have their own customer thresholds prepared. There are usually 10 of them.

If the customer is perfect, he falls into the threshold of 1 with the best offer, APRC, eg 4%. If the customer already has loans, there have been delays, inquiries can fall even to the threshold of 10, which results in an expensive loan with APRC 23%. Such a large divergence of offers means that a customer who does not have specialist knowledge in the field of bank loans can find an expensive offer.

Taking an expensive loan will only result in the entire repayment period bearing costs up to 20% higher than if we obtained the cheapest loan on the market. It is worth turning to professional credit brokers. They know which bank will be the most appropriate for a particular customer.

The process of applying for a bank loan

The process of applying for a bank loan

Applying for a bank loan also has no time frame. In one case, we can leave the bank after an hour with the loan activated, in the next time spent on visits to the bank, the analysis will take a good few business days. A significant saving of time is cooperation with a credit broker. He will immediately tell us what documents will be required by the bank. There will be no situation when we go to the bank today, tomorrow an employee calls to provide some information, and 2 days later he will tell us that there is still another signature missing from our application.

Such a process can lead to frustration. An additional thing is to submit the case for analysis, phone calls to us as clients and to employers regarding income confirmation. If the offer proposed by the bank is not satisfactory, it will not hurt to go to another bank. However, you should not make more than 2 credit inquiries. In this situation, if both offers are not satisfactory, please contact a recommended credit intermediary. Such a specialist will certainly find the cheapest cash or consolidation loan available to us.

Analysis and decision making by the bank

Analysis and decision making by the bank

After entering a loan application previously prepared with a bank employee, a decision or analysis process takes place. Bank analysts may want to call the employer to verify employment. They ask when the client has been working, for which contract form and for what time. The bank may also request the client to provide a certificate from the employer on its print. Banks have different types of printouts, which is why some clauses to be marked by employers may differ slightly. The analysis process can take from several hours to even 3-4 business days. It all depends on how many conclusions are in the analysis and how efficiently the analysts will work. The time in which they reach the employer and the client is also important.

It is definitely simpler to work with a loan broker who, through close cooperation with the bank, can greatly improve this process. In 90% of cases, loans are run without great verification and analysis. There is no telephone number for the employer because the certificate or recent transfers from the employer are reliable enough. After passing the traditional analysis, a bank employee calls the client with information about the possibility of signing the loan.

At this point you should also be careful and ask about the loan terms carefully. People working in banks sometimes overstate commissions or add credit insurance. They earn better commissions on such loans because they are more expensive.

Time to get a business loan

Time to get a business loan

What is the real time to get a loan for a company? A business loan is out of time because more factors affect it. Such are the certificates of non-arrears with ZUS or US. It depends on the bank’s offer which document from these 2 will be needed. Usually, the documents provided by accounting are the thing that extends the loan application period. It depends on the accounting efficiency when it will provide the relevant income documents.

In the case of companies, it is recommended to contact a credit advisor or broker regarding products for companies. The adviser will competently prepare the plan and specify the documents for the loan in detail from the beginning.

Looking for a loan yourself is a time-consuming task

Looking for a loan yourself is a time-consuming task

According to the summary – getting a good and cheap loan is a very time-consuming occupation, not always successful. Therefore, it is better at the very beginning to think about transferring the case to specialists in the field of obtaining bank loans. They cooperate with a dozen or so banks and constantly monitor the cheapest offers that banks have to offer.

The decision made today in the field of credit will have its impact on the next 10 years, in the case of credit for such a period. Therefore, let’s not act hastily, cheap credit will definitely be better than that with additional commissions and insurance. Remember, not only the time to get a loan matters. Its price and conditions are also important.