Credit bureaus empower people to know the intricacies of applying for a loan, having it approved, and fulfilling their obligation – all of which translate to financial responsibility. These determine the creditworthiness of an individual.
While a bank will have information about the debt that you owe their institution specifically, the information that a bank has is limited to what they have in their portfolio. A bank would know that you have a personal loan with their establishment, for example, but they wouldn’t be aware of other lines of credit that you may have, such as clothing accounts, a cell phone contract, a microloan, or other lines of debt.
Credit bureaus are trying to widen the scope of information that banks have at their disposal. A bank will have a good idea of the income that gets paid into your bank, but they can’t determine how much you are able to pay if you were to take on additional lines of credit with them. It is for this reason that they use credit bureaus to find out what an individual’s credit score is before they decide whether they should extend more credit to the person or not.
With car financing, a bank may not be willing to finance your new vehicle if you have a poor credit score. If you have been blacklisted or have a poor credit score, you could consider rent-to-buy car financing such as that offered by Earn-a-Car. With this type of financing, your credit score won’t be investigated and you only have to meet a few minimum criteria to qualify.
Need more information about rent-to-buy car financing? Contact us for more information today.