When you think about the credit bureau, the first thing you think about is debts, late payments, legal issues and limitations to access credits available in the market.
The truth is that you need to be in credit bureau to be able to acquire a loan or ask for a loan
If you are a little confused by this, do not worry, in Small Lender we will help you understand what the credit bureau is and how a proper management of personal finances is the key so you can presume that you are in credit bureau. We want to eliminate the false belief that the credit bureau is a negative step in your financial life.
What is a credit bureau?
As we share it in our glossary of financial terms, the credit bureau is a private company, which is responsible for collecting information from all customers who have or have had any credit or loan from the institutions that grant credit in Mexico. As you read, all of us who at some point decided to request a loan, credit or have contracted a telephone or cable service are in credit bureau, and the management of that credit is what determines if our credit history has a good rating or low. And with this brief explanation we completely eliminate the idea that if you are in a credit bureau it is because you have not paid a loan or credit. If you are in credit bureau is because you have a financial life, the key is to know if your rating is good or not.
How does the credit bureau work?
When you apply for a loan or access a loan, you automatically start creating your credit history, that is going to reflect every movement you have made related to a financial institution, including buying insurance, applying for loans or acquiring a credit card.
The credit bureau itself does not determine whether you are a person who may or may not access credit. Simply give a rating based on the behavior that the client has had with their financial obligations since he began creating credit history. The banking institution is the one that will decide, based on that information, whether or not it grants the credit. This credit history has a positive or negative rating, and the main factors that influence to determine it are:
- Credit limit – The maximum amount you have had available in your credits.
- Payment history – What has been your behavior regarding the payment of your credits or loans?
- Outstanding and / or settled balances – If you have settled your loans or credits or for some reason you have not been able to pay it and it has become a debt.
How to check if you are in the credit bureau?
If you have already had some type of credit, you are in credit bureau. To check your credit bureau rating and check your credit history, you need to access their website. You have a free consultation per year.
What do you do when you have a low credit bureau rating?
If at some point in your life you went to ask for a loan, you began to cover your monthly payments on time but in the end you fell behind for some reason, probably your credit history has been affected and you have a low credit bureau rating. This means that you are probably not a “credit subject”, so you are a bit limited when you think about asking for a loan or credit.
But you can act to solve this problem. Initially, you need to regularize your financial situation, and have a better management of your personal finances. If you have outstanding payments, it is better that you go to the granting financial institution and generate a payment schedule that does not affect your economy, and allows you to settle the commitment within a certain period.
The credits registered in the credit bureau are eliminated as you go paying. Those that you have not settled, also disappear after a certain time, but still leave a negative mark on your credit history.
Can you leave the credit bureau?
Surely you have heard the phrase “in 6 years I leave credit bureau”, and we want to clarify this point. Initially, once inside the bureau, you can not leave. Your credit history remains intact, with or without movement. What can happen is that your history undergoes modifications and after a certain time, your debt can be “forgiven”. Know below the deadlines and the amounts allowed. • More or less $ 113 pesos: it is eliminated after one year. • More or less $ 2,260 pesos: it is eliminated after two years. • More or less $ 4,520 pesos: it is eliminated after four years.
These terms begin to run from the moment in which the financial institution reports a delay in the payment of the credit, or since its last update to the credit bureau. At Small Lender we want you to be able to request a loan with us without problems, so we invite you to maintain an adequate management of your personal finances. Remember that our online loans are quick and easy.