What to remember when building your credit history? How to start and what to look for using financial support from financial institutions? Do you want to know the answer – we invite you to read our material, in which we help to explain how the Credit Information Bureau (BIK) reports can help in managing daily financial decisions
How to start?
The credit history begins when the first loan application is submitted. If a loan is received, the Credit Information Bureau updates all data on its repayment – both positive, eg timely payments, and negative ones, related even to arrears.
If we need to replace a kettle or iron, it is worth taking this opportunity to start your credit history, eg by buying this equipment in installments. A loan for the purchase of goods and services is also a banking product, so it builds creditworthiness at BIK.
Thanks to the credit history at BIK, we are not a “white card” for the bank. However, the lack of credit history means that the bank does not know what to expect, so it approaches cautiously and will either grant a smaller amount or more expensive to compensate for the expected risk. Paradoxically, the lack of information is much worse rated than the image of a client with many, but regularly repaid loans. And here an important note – BIK stores data on positive repayments only until the full repayment of the liability – unless the Customer gives special consent to use such information after repayment. It is worth remembering when building yourcredit history in advance. On the other hand, you should be very careful about repayment timeliness. Information on arrears in the repayment of loans and borrowings is stored by BIK and this does not require any special consent of the Customer. Such data is made available by BIK on credit reports for 5 years and has a negative impact on our credibility assessment.
If we start building our credit history in small steps, we will show that we are reliable partners for the bank. This will allow us to use loans in the future while implementing our various plans and needs, including the larger ones.
It’s best to go to the bank for the money
Data for BIK are reported not only by banks, but also by financial institutions outside the banking sector. These companies grant loans for a very short time (usually 30 days), often charging high fees compared to the banking sector. They attract customers with quick and easy access to money. Problems may arise with the settlement of high payments on time, which is associated with a decrease in creditworthiness. When looking for a cash loan, you can still find offers called “Loans without BIK”. Although there are fewer and fewer such offers on the Polish market, they should cause increased vigilance. The costs of granting and servicing such loans are usually disproportionately high in relation to the amounts of money borrowed.
Market analyzes show that from a statistical point of view, customers using non-bank loans are more likely to delay paying their liabilities than bank customers. It should be borne in mind that banks may take this fact into account in their own credit application assessment processes. The best and safest option to borrow money is to go to the bank for it, where the offer is transparent and its terms are set out in the contract in a simple and legible way. It is worth checking how you can apply for a cash loan at Sandugo Consumer Bank.
BIK reports – all information in one place
For credit assessment are used, among others data stored in the BIK regarding customer obligations and repayment history, as well as information on credit inquiries. Banks have extensive credibility assessment systems, taking into account many other elements besides BIK, however, the client himself can get an idea of his assessment on the basis of reports that he provides to BIK clients. This can be particularly useful if the bank provides information about the check in the BIK database as the reason for refusing (banks are obliged to provide such information). Customer reports from BIK show – whether in the form of stars or scores, what is the assessment of the customer’s creditworthiness. The more stars or the higher the score, the more credible we are to the bank.