[ad_1]
On 15 minutes the publisher asked not to reveal his identity to the reader, for whom the decision to buy his first home turned out to be an unexpectedly difficult mission. Like the vast majority of the country’s population, he decided to apply for a mortgage from the banks. After reading recommendations online that you should contact at least some banks, you became interested in the terms of loans made by banks in the country.
However, the man soon saw that bank offers were getting worse and interest rates were higher, so he inquired about his credit rating on the popular Creditinfo system. According to the company itself, it helps make credit decisions for all commercial banks, 98 percent. other lenders and more than 1,500 companies.
It turned out that the person’s creditworthiness was verified by at least two banks during that period, one of them repeatedly, and his rating dropped from C (medium trustworthiness) to D (low trustworthiness) during the week. The man says that he did not take any loans during that week and suspects that this situation may be due to the frequency of inquiries from the banks contacted to the platform.
That would not be news. three years ago 15 minutes he has already written about bank clients in similar situations.
“It just came to our notice then. It takes time to check with the banks. When I started to move towards an offer, they told me that I couldn’t make a loan because my credit rating was too low. The rating itself is in sight, If I had filed even more applications, I would probably have been insolvent after that, ”said the indignant interviewee.
123RF.com nuotr./Paskola
The man also said that he did not understand the current procedure; such processes, according to him, prevent the client from seeking the best conditions. “It should be like this: you can apply to as many institutions as you want, choose an offer that satisfies you and sign a contract. Now it is the case that if you apply to three banks, you will get the best option first, and nothing good about the rest, because you qualification will already have lowered. There is no competition, after the second bank it becomes risky, if you apply for one, it is better to stay with him, “said the man.
The interviewee said that his loan offer could have deteriorated by about 10,000. euros. He believes that the problem can be solved, but believes that other people in the country may be in the same problem, so he turned to the media to warn them.
Photo from 123rf.com/Real Estate
To solve his problem, the reader also contacted Creditinfo. At first, he tried unsuccessfully to explain his situation over the phone, but eventually received an email asking if he would like an employee to recalculate his credit rating instead of the company’s algorithm. The man agreed to such an offer, but said that he had not yet received any knowledge.
„Creditinfo – Rating indicator responds to requests, but we have protections
Ieva Kutkaitė, Creditinfo’s marketing manager, said that the calculation of its rating has its own details and emphasized that global practice shows that if several creditors intensively verify the creditworthiness of a certain person, this indicator, evaluated in combination with several other indicators , you can point out potential growing risks.
“Studies show that there is a clear correlation between credit activity and debt; statistics show that people with little credit activity have six times fewer arrears than those who are very active.” 15 minutes said the interlocutor.
It is true, he added that to avoid situations such as that of the reader, in 2019. A “preferential” or “quarantine” period of 30 days was introduced during which the rating does not respond to the increase in the number of applications. The marketing manager of the company stated that with the introduction of such an improvement, there are almost no complaints from the public on this issue, unless they are individual cases.
Photo by Sigismund Gedvila / 15min / Loan
I. Kutkaitė also emphasized that if this deadline is exceeded, the number of inquiries may begin to have a negative effect on the rating. If high credit activity persists for several months, the algorithm will retrospectively estimate the frequency of recourse to banks and other credit institutions and adjust the rating accordingly. “In general, 30 days are enough to choose the best conditions and decide on a loan. In this way, a client who decides to consult the interest rates of several banks will not be able to worry that their credit rating may drop during this period due the increase in activity in credit institutions. However, credit activity has not disappeared from the algorithm for calculating the credit rating, as it would be wrong, so it is not worth relaxing, “said the interlocutor.
I. Kutkaitė added that qualifications calibration work is currently being carried out, variables and influence indicators are being reviewed, taking into account the changing market situation.
„Credit activity is only one of the four components of a credit rating. The other three are payment history, length of credit history, and financial data. “Each person’s credit rating consists of this set of four components, and although the credit activity factor is not more important than the others, it affects the rating calculated by Creditinfo,” he said.
Finance companies agree that rating cannot be a determining factor
15 minutes The financial market representatives interviewed unanimously agree that such rating should not determine whether a resident will receive a loan. Creditinfo representatives agree with this.
“Credit institutions take into account the credit rating calculated by Creditinfo, but do not follow it when making decisions about the terms of the loan. “Creditinfo’s rating is primarily intended for the person who wants to see an objective and unbiased picture of their creditworthiness,” said I. Kutkaitė.
Representatives for Swedbank, one of the two largest banks in the country, also said it is asking other companies for personal liabilities and payment history. In this case, the bank requested Creditinfo at least three times a month.
Photo by Sigismund Gedvila / 15min / Swedbank
“When evaluating a client’s borrowing opportunities at Swedbank, we take into account the client’s financial condition, stability and prospects. We would like to point out that we conduct an independent assessment of the client’s credit risk, which is not dependent on CreditInfo’s credit rating. Therefore, the number of inquiries about a person’s indebtedness made at the credit bureau of the credit bureau does not affect the assessment of a person’s access to a Swedbank loan. 15 minutes Swedbank spokesman Saulius Abraškevičius commented on the situation.
But 2018 m. 15 minutes After making this situation known, the representatives of the Bank of Lithuania stated that banks must carry out a detailed assessment of the creditworthiness of the consumer in each case before entering into a loan agreement. This is detailed in the legislation.
Julius Kalinskas / 15min photo / Lithuanian bank building in Vilnius
The opinion of the Bank of Lithuania does not change: according to its representatives, a person should not be punished for seeking the best loan conditions, whether it is for housing loans or consumer loans.
“We encourage people to evaluate both their borrowing opportunities and the best terms before applying for a loan. It also encourages consumer-friendly competition in the marketplace. Currently, only these isolated cases occur when it comes to complaints or disputes of consumers. As for the case you mentioned, without all the information and without hearing all the arguments, we cannot evaluate it. In general, the credit rating should not be lowered due to inspections of two banks only, “it is written. 15 minutes in the reply sent by the Bank of Lithuania.
[ad_2]
