If you’re looking to improve your chances of getting a loan, then there’s some important information that you absolutely need to know. We get many people coming to us that we aren’t able to help due to one simple mistake they’ve unknowingly made well before we’ve talked to them. It’s the very reason why it’s so important to use a broker like Max Loans instead of going direct and it all has to do with your credit score.
What’s so important about a credit score?
A credit score is what so many businesses use to determine if you’re a good risk to lend money to. It doesn’t matter whether you’re opening a bank or phone account, applying for hire purchase or trying to get a loan – each and every time your credit is checked.
The thing that most people don’t know is that when these checks happen, it alters your credit score. Whether this is a positive or negative thing depends totally on how often it is being checked.
When credit checking can become too much
If it’s being checked 2-5 times a year, then your score won’t change that much. In fact, it can be a good thing as having no credit score means a business won’t have much of an idea of what you’re like to lend money to.
But if you’re out there shopping around a lot of different finance companies then each of them will do a credit check. This will leave you with a lot of enquiries all at once and the unfortunate thing is that when this happens, it lowers your credit score a lot.
How does this lower score affect me?
In this situation, with your credit score lowered by all the lenders inquiries, based on that alone, many of them won’t even look at your application. It doesn’t matter how good everything else is about you, the continual credit checks in a short space of time trigger their system to say “no”. So shopping around can end up costing you big time.
So what do you do about this and how can Max Loans help?
The first thing we hold off on is credit check. Being a broker, we know what else our variety of lenders will look at first about you. This means we know who’s more likely to approve your loan based on your profile.
Once we’ve narrowed that down, then we do a credit check before placing it with the lender/s that we know can provide you with the best deal.
Some lenders will do their own credit check as part of their process but with us having limited the checks, this doesn’t negatively affect your credit score. By us taking this tactical approach to your loan and not just shopping it around to everyone, we’re able to keep your score in good shape. Considering all the things that various businesses use your credit score for, this is pretty important for you.
How do I improve my score?
As they say, time is the greatest healer. If you’ve been shopping around then you have to just lay off applying for loans for a while and after about 6 months your credit score will start to go up. But sometimes waiting for that long when you need money straight away can be a real issue. But by far the easiest option is using a broker like Max Loans, where we make sure your credit score is kept in good shape.
So what should I do if I want to get a loan?
Contact us straight away so that we can protect your credit score by only going to the lender/s that we know will a) be more likely to approve your application and b) will suit your needs. It’s only by us being a broker and knowing all the various lending criteria of each lender we work with, that we can preserve your credit score.
So if you want to know more just drop us a line or if you’d like to apply now for a personal loan, consolidate some debt or purchase a car, then complete our quick and easy online application. We have some great rates starting from 7.95% and would love to be able to help you get the money you need.
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If you want to find out what your credit score is without damaging, then visit www.mycreditfile.co.nz