It takes years to build an excellent credit history. Some people are really deft at financial management and they succeed at maintaining an excellent credit score. Most people, especially those who have had to deal with financial emergencies, will find it near impossible to have an excellent credit score. It is interesting to note that the maximum credit score in the United Kingdom is 999 but the average credit score is 757. An excellent credit score is between 960 and 999. This is with Experian. If you were to consider Equifax, then their excellent credit score range is from 470 to 700. It is a much broader range but most people have an Equifax credit score way below 400. You can imagine how elusive the excellent credit score is for millions of Britons.
While it takes a long time to have an excellent or even a good credit score, it takes one misadventure for the entire credit history to be effectively ruined. One incident of financial mismanagement may not lead a credit score of 800 plummeting down to 200 but there will be a substantial fall. The moment your credit score falls into the average category, you would qualify for short term loans or even long term loans such as mortgage only when you agree to pay a much higher rate of interest. Some people may be unaware of this reality. An average credit history does not render a homebuyer ineligible for mortgage or home loan. The home loan amount would be less, the rate of interest will be high and the terms would be less favorable for such a borrower. Those who have a poor credit history may not qualify for a mortgage.
Those who have a below average or poor credit score will not qualify for most long term and short term loans from banks and other financial institutions. This is why and when people turn to payday loans and other unsecured short term loans. While you can always borrow some money by applying for payday loans through Payday Pug and take care of your financial commitments, don’t forget the larger and long term picture. Don’t forget that your repayment or the failure to repay payday loans will have an impact on your credit history. Your credit score may not make you ineligible for payday loans or other unsecured short term loans but the transactions will get reported to the credit bureaus. While this could have a negative impact on your credit history if you fail to repay the payday loans on time, there is a silver lining to it. You can actually rebuild your credit history and improve your credit score with the help of payday loans.
Payday loans are small sums of money lent for a short period of time. They are designed to meet urgent expenses. Qualifying for payday loans, especially if you are applying through Payday Pug, is quite easy. It is practically a cakewalk compared to qualifying for short term loans from banks. You can take care of your expenses with payday loans, repay on time and rebuild your credit history at the same time. Many financial advisors actually recommend people who have bad or poor credit scores to use products such as payday loans and other unsecured short term loans to improve their credit history. It does not take much time and you stand to benefit in a myriad of ways through the process.
There are positive and negative consequences of repaying and not repaying payday loans respectively. Most lenders will automatically report bad debts. If you fail to repay and your account is assigned to a debt collector, then you can be almost assured that such a development has been reported to the credit bureaus. Hence, your credit score has taken a hit already. If you have repaid on time, a lender is supposed to report the same to the agencies and your credit score must improve. However, some lenders may not always report such transactions. Such accounts don’t get transferred to debt collectors. It is mostly the collection agencies that report to the credit bureaus in a more steadfast manner. You must ensure that your lender reports the positive transactions so you can rebuild your credit history.