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Credit Report: Facts, Tips, and Everything in Between

We may not have a strict credit rating like the USA, where they actually have a quantifiable figure for how much of a good or bad payer we are, but do keep in mind that credit history matters even in a third world country like ours. This credit history is one of the main reasons why it’s so hard for you to get approved for a loan or even a credit card.

I’ll let you in on a little secret: Once you send in your loan applications, banks and loan institutions order their Credit Investigation team to check on your credit history.

What is a credit report?

 This is a document that accounts your credit history. It lists everything you have ever loaned and tells them if you’ve ever made a late payment on your loans, or if you have an existing one! We don’t have a specific agency to measure an individual’s credit score, but banks do have internal systems. They can check if you ever had a previous loan with them to determine if you are worthy to be granted another one. If you have never conducted business in that bank, then they will rely on external sources and other institutions to further check. And obviously, if you have good results on your credit report, it’s highly likely for you to get approved.

Is this legal? 

The short answer is yes. The long answer: collection of credit data is mandated by law through RA 9510 or the Credit Information Systems Act. This law also created the Credit Information Corporation or CIC which is tasked to collect the credit information from banking and other financial institutions.  But a credit report is not just for lending firms. In fact, you can request for your own credit report, although you need to visit their office for that. Although you do have to shell out at least 55  pesos to get this done. Although you must be aware that you cannot have your name excluded from the CIC’s bank data because that would be against the law.

Whatever the results of your credit report are, you really must not worry. Just make sure to pay your dues on time and you’d have a better credit rating soon enough.

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