When a person wishes to acquire a loan and lacks a credit history , in most cases it is denied. This happens because what the banks evaluate is their payment behavior, that is, the way the person has responded to their debts. Since he has never acquired a loan, he is not known to anyone financially. When this happens, the first thing that different entities ask for is that there is something that supports and supports the debt.
However, today, traditional banking methods have been replaced by an avant-garde system. This system allows access to a loan despite not having a credit history that guarantees the ability and willingness of the person to acquire it. Hence the importance of starting a credit history that allows you to later opt for a long-term loan. An example would be mortgage loans, commercial, among others.
How to Start a Credit History?
Most of the time when we decide to undertake and require a loan. We question ourselves about the possibilities we have at the moment of opting for a loan for the first time. Many times we think that accessing a loan can help us even to achieve our dreams. Our dreams may be to acquire a house, a car, complete a career, or maybe start an economic activity. However, in most cases, the loans to which we apply are not accepted. This is because there are several reasons why this can happen, credit history is one of the most important.
People do not have a credit history because they were born with it, nor is it a priority to build it during their lifetime. Then we must ask ourselves: From what moment does the credit history begin? It usually occurs from the moment a person assumes the commitment to make a series of payments for some service, product or loan. From here they begin to register their payment compliance history. In this way, the bank can assess how profitable it would be to grant the loan to the person who is requesting it.
That is why to start a credit history it is necessary to commit to making a periodic payment. This through a contract, since that in one way or another reflects the degree in their financial education, responsibility, credibility and suitability to assume greater commitments, at the time of acquiring a loan.
Is it possible to acquire a loan without credit history?
Until very recently it was virtually impossible to acquire loans without credit history. Traditional banking exercised total control over financial services in the world. However, in recent years they have transcended new modalities to access a loan. This despite lacking a credit history .
The era of technology has made it possible for even the internet to opt for different forms of financing. This without having to go to the bank, being able to request it completely online and it is not necessary that it be with a banking organization of those already known. This is how the new companies or startups that combine finance with technology called Fintech provide online credits. This allows them to make the process easier without having a credit history .
This, of course, does not exempt some requirements and informative data that ask anyone who wants a loan. This to determine your borrowing capacity and willingness to pay. These types of loans are usually of moderate and accessible amounts. These can be used for any purpose such as paying for studies, to go on vacation with the family, among many other possibilities.
Lacking credit history and opting for a loan, interest will be more expensive. This is because the entity does not have information that makes you a reliable debtor. These types of organizations have become very popular among market sectors. These organizations were considered forgotten by the traditional banking system.
The dynamics of Credit History
It is a secure system and one of its characteristics is that it is more flexible than a traditional loan. This is because the possibility of entering the financial system is really cumbersome for some people. These people, lacking credit history , do not meet the necessary requirements to do so.
These types of loans are used most of the time to meet unforeseen needs or small businesses. These investments allow their recovery in the short term. The approved amount for the loan is proportional to the income of the applicant. The bank assesses whether it will be able to make payments according to its economic possibilities. Basic requirements such as identity document, age of majority and proof of income are also requested.