Importance of personal credit ratings in loan application
The personal credit rating refers to the personal qualities of the auditee. The question is: What kind of person am I dealing with? The following factors are usually examined and included:
Occupational activity and qualifications:
The more recognized the profession is and the higher the level of education, the better the personal credit rating. An employee in a high position in a highly respected company is generally considered to have a better credit rating than a self-employed person. Academic degrees, such as doctoral degrees, or other highly respected education and qualifications also round off the picture of better credit quality.
How safe is the workplace? Even with employees there are differences. Is this a temporary or permanent employment relationship? How long has the employee been at the company? As a rule, the longer the employment relationship, the better the personal credit rating. An open-ended employment relationship is accordingly preferred.
Payment history in the past
Has the person proven willing to pay in the past? There are people who, despite their large fortunes, are reluctant to pay their bills. These people are also credited with a lower credit rating.
Residence & Housing
Does a person live or move to a permanent residence for years? A permanent resident with a stable housing habits usually leads to a better credit rating as this person is more predictable.
Family is beautiful, but it is associated with financial burdens. The more children you have, the less likely your personal credit rating will be. Single persons are only better off to married persons if the spouse does not have their own income, which is sufficient to cover the need for life.
In the case of personal creditworthiness, it is checked whether the person can prove appropriate behavior in order to be eligible for the desired credit or contract.