Credit scoring is the term used to describe a complex system that many banks and both mortgage insurance companies have derived, to assist them to better decide whether they want to approve your loan.
It is a highly complex system that no-one fully understands, apart from the developers of the system. And the banks and mortgage insurance companies want to keep it that way.
From whether you have a home number, to how long you have lived at your address, been at your job, or how much your belongings are worth, these factors all influence your credit score, and if you have too many negative points, your loan can be declined in full, even if you have more than enough money to afford the loan.
Applying for multiple loans has a huge impact on your credit score, whether you are applying for a home loan, personal loan or car loan, you can be more likely to be declined if you have applied for several loans in the previous months, or even years beforehand. Each time you apply for a loan, a record is kept on your credit file, and this along with many other factors, including those listed above, will all influence your credit score.
If you have been applying for multiple loans in the past, it is worthwhile to get a copy of your credit report and show this to your finance broker. At Bee Finance Savvy, we make informed decisions before applying for your loan, and if too many credit enquiries is going to be a problem, we know just where to take you for your home or car loan, to avoid a flat out decline.
Call us on 1300 140 554 or email firstname.lastname@example.org to find out more about credit scoring and how this can affect your loan application.
You may also enjoy – Please-dont-look-at-that – are you worried about your financial past?