Credit Bureaus: Prize Or A Punishment For The Borrower? Part 1

Bureaus of credit histories reflected as a prize for prompt payers under credits — as to them promised reduction of rates. But instead borrowers have received a punishment. So you know that this could happen, too.

In the beginning of February, 2009 the IT manager of one capital company has overtaken the most unpleasant news: the insurance company has raised for her the tariff under the INSURANCE policy. As a result payments under the insurance have grown to $1200. Such decision the company has accepted referring to that fact that, say, I restructured one of two credits. To argue it was useless.

In a similar situation there were thousands of borrowers. And financiers accepted relevant decisions on the basis of the data received from bureau of credit histories.

The initiative is punishable

Almost all credit contracts contain point according to which the borrower voluntary agrees on data transmission to credit bureau about timeliness of debt acquittal. Such consent makes a reservation the legislation under quite plausible excuse – decrease in risks of crediting. As a result in a prize there should be debtors: to the reliable promised decrease in rates. So this system works in the western countries. But it is not perfect and sometimes there can be errors, too. Financiers didn’t reduce the rate, referring ostensibly to low quality of the information, at the bureau disposal. And with arrival of crisis the bureau data “suddenly” became claimed: on the basis of their data the insurance companies and banks have started to review cost of services in running contracts – towards increase.

Owners have got to a risk zone consumer and the mortgage loans nominated in foreign exchange. As a result with tarnished reputation there was almost every third borrower the data about which is contained in credit bureau. The similar picture is observed and in International credit bureaus.

According to statistics, by February, 2009 the share of problem with credits on which delay of payments on a body of the credit and percent has been fixed, it constitutes 13,46 %. As a whole from the beginning of 2008 on the present on 34,18 % of credits delays payments during all duration of the agreement were observed.

In an amicable way on a level with borrowers the state and monetary institutions should divide responsibility for so depressing statistics – both have admitted punctures in a risk management. Nevertheless, owners of credits are answerable for collective errors – their rating of reliability decreases, about what there are corresponding records in credit bureaus.

But if borrowers believe that attempts to restructure payment will positively affect their reputation supposedly thus they show the intentions to carry out of the undertaken obligations we hasten to disappoint them: all can appear just what isn’t needed. The payment adjourning in the future can become for financiers a strong reason for a presentation more than crediting severe constraints. And hardly someone will give a discount for an economic crisis. People who borrowed money and don’t return them, should know: all is fixed in their credit histories. It means that when crisis will end, credits for them will cost more expensive. Because the non-return is first of all fault of the borrower.

Do you still remember those good times when practically anybody could take a loan if one needed funds? And just imagine the condition of those who have to bear that load nowadays when the world economy is facing hard times. And for those people having loans the question of credit monitoring is as crucial now as never before. It is not only about loan control, this also helps save money, time, and nerves and be fast in solving loan related problems. Those who are searching for a spot where to find out about credit report, are welcomed to check out this credit report monitoring site – there is lots of information about credit monitoring and how to order the service.

Also we shouldn’t forget about possibilities provided to us by digital technologies. The online network provides us with a truly unique chance to discover what we require or to obtain anything on the best terms which are available on the market.

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