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How Credit Report Can Tell People About Your Personality

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Authored by Yudi Yuviama in Credit Card
Published on 01-20-2009

It is a snapshot of your financial situation; your credit report can also indirectly predict your likely behaviors and actions in different parts of your life. The fact that you have a history of late credit card payments can tell a potential landlord that you are liable to be late with your rent payment, too. A history of loan defaults may tell to a prospective boss that you are not someone who follows through with promises and commitments. If you get a foreclosure in your financial record, it may suggest someone that you tend to take on more than you are able to handle or are just another unlucky duck. If you have declared bankruptcy due to your uncontrolled finances, perhaps you are out of control in other ways of life, too. This snapshot, which is focused on the details of your expenses and borrowing and even indicates your personal life behaviors, also illustrates a finer picture of two significant factors – characteristics that are important to landlords, bosses, lenders, and others. I cover these two important characteristics in the sections below.

It Tells People About Your Promises

Your credit record is an indicator of whether you are an individual who follows through with promises and commitments – a characteristic significant to many people, whether they are searching for a dependable employee, a trustworthy nanny, a reliable renter, or a loyal business partner. However, someone or financial company who is thinking about lending you a considerable sum of money will need to know the same. Based mostly on your record of following through with your financial commitments and promises, you are assigned a credit score. Individuals with higher scores typically get the most advantageous terms, like reduced minimum deposits and lower rates of interest. Individuals with poor credit scores may not have credit in today’s declining economy, unless they agree with higher rates of interest and perhaps supplemental insurance or fees. Even then, they may not eligible for anything, under rigorous and tight approval procedures.

It Tells People Abut Your Punctuality

Following through with your commitments is only halfway of the game. The other half is doing it according to schedule. In the money lending business, the more overdue a payment is, the more probable it will not be paid at all – or paid completely. That is why, as you get further behind in the overdue payments, lenders become more eager about collecting the debt. As a matter of fact, if you are sufficiently delinquent, they may force you to pay off the whole amount immediately rather than as originally scheduled. (The creditors’ faith in you is only thirty to ninety days long. Car dealers, infamously lack in faith, think that the Armageddon is happening in credit terms if a payment is late by just a couple of weeks.) So the longer it takes for you to do what you promised, the more it will cost you and the more damage will happen to the credit score.

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