Credit Check is absolutely crucial for individuals and entrepreneurs alike because it remains a good marker of their financial status. If you are looking for a loan at any point in time, for one reason or another, your credit history can assume great significance. And on many occasions the onus is on you to ensure that your credit record is up to the mark so that you can get the loan that can make a huge difference to you. That’s the reason it’s considered to be imperative that you get these checks done on a regular basis.
However the problem with that is you often have to contend with a time consuming exercise, which can be quite tricky as well. That’s the reason there are many who overlook this aspect of their financial status completely, much to their peril in the long run. On the other hand there are those who have made the most of the option offered to them by professional companies and to good effect as well. Thanks to the National Credit Act in South Africa, now it’s a lot easier for these companies to help run these checks for you and they give a much needed shot in the arm to your financial plans.
Each and every one of us wants to be financially independent without any debts and loans. There are only a few who succeed in becoming financially strong and the others do fall in trouble because of improper use of funds and lack of planning with their finances. It is not something that they do on purpose but as mentioned earlier, due to lack of planning and lack of proper guidance, people commit those financial mistakes. We often see such individuals getting into the bad credit area which is very difficult to come out of.
We try a lot to come of such situations but there are certain commitments that need to be fulfilled. But with bad credit we often do not get a chance to meet those requirements. Loans get rejected and we do not get any help from personal sources as well. However, there are bad credit personal loans which are exclusively provided to individuals with bad credit. One should also understand that it is not a good practice to apply for loans each and everywhere they get a chance. The credit score will unnecessarily get affected with number of lenders trying to access your credit score for the purpose of loan approval.
A personal loan is an amount given by a bank on a certain percentage of interest. Anyone who has a stable ob and a bank account can apply for a personal loan.
People with less credit score in their credit history always find it difficult to get a credit card, find it difficult to get a credit card, car loan, personal loan etc. If a person is a good risk, that is, there is a good chance of him returning the
money back they will give immediately sanction means he is in the habit of not paying back the debts in time or having an existing huge debt, is bankrupt, or has been declared a defaulter by a bank. Such people face a lot of difficulty in applying for a loan. But all those who demonstrate the ability and determination to repay the loan have the chances of having their loan being sanctioned.
The obvious difference between a guarantor loan and any other type of loan is the inclusion of the guarantor. A guarantor is someone, usually a close friend or family member, who can act as a ‘back-up’ for your loan should you not be able to pay. Their role as the guarantor can be varied, depending on how well the loan is handled. Here’s all you need to know about what a guarantor does and who can be one:
Why is a guarantor needed?
A guarantor loan exists mostly for those who are unable to get credit from other places, possibly due to a poor credit history or even no credit history at all. The guarantor is the security for the loan – if someone has had no proven record, or a flawed record, of borrowing in the past, then the loan company has to be sure that the loan can be managed properly. Sometimes, a guarantor is needed even when the person taking out the loan has a good history of borrowing. This can happen if they’ve got no job history, or if they’ve only recently moved to the U.K.
Who can be a guarantor?
It is compulsory and a person’s duty towards his company goals or business to get a credit check. A simple credit check involves keeping track of the credit score of a company at a particular point in time. It is helpful in terms of preparing a future plan with regard to the future course of action. Maintaining a credit score will be crucial to both outsiders and insiders of a business situation. For outsiders, it could serve as health picture on the credibility of a company to meet its credit obligations within a certain time frame and horizon. For insiders, it could serve as control check that could either decide on a voluntary liquidation or a warning. One can be aware of factors that could serve as a contingency in determining the outlook of the business, if proper steps are not undertaken.