Having Credit History vs. having No Credit History


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Credit Card Applications » Research » Guides » Building Credit History » Having Credit History vs. having No Credit History

Having Credit History vs. having No Credit History

The content is accurate at the time of publication and is subject to change.
Because of the necessity of a credit history in today's society, consumers are encouraged to have at least some track record of their spending and payment behaviours. But just how important is a credit history and why is it treated as so, and how would it compare with the situation of having no such record? This article would answer these questions, and show why consumers such as yourself must have such a history. Credit histories are used to gauge your creditworthiness as a consumer, to keep track of your spending habits and payment behaviours. This information is important nowadays so people and institutions would know who is responsible and capable in handling their finances, and if they could use these same skills in more practical matters. This is make certain that the financial situation of the consumer would not hamper the operations of an institution. If there is a lack of this information, then there would be problems for both the consumer and the people/institution who need that to know about that knowledge. Credit histories allow consumers to have access to privileges and even modern day necessities such as insurance, mortgage, and even job opportunities. Meanwhile, those that have little or no record of their credit history would have a harder time to get them. A fine example is the lattermost item mentioned: job opportunities. Nowadays, companies and institutions check on the credit reports and history of those they are looking to promote or hire. If they find that an employee or applicant lacks the record of his/her credit history, then that person would have a harder time getting a promotion or even the job - this is likely because having little or no credit history is equated to having a bad record. Another privilege that credit histories could give to consumers is that they are able to set up credit accounts to make their payments and purchases easier to do in the form of a credit card. Credit card issuers usually check on the credit report of a client before allowing them to start an account or borrow credits, and those that do not have a credit history would not be able to have access to that privilege. The same could be said when your borrowing money from your money lenders, as this institution is the same for-profit business as credit card issuers in that they need to verify the consumer's credit history before lending them money. As long as you have a definite track record of your payments and purchases, you could have access to these privileges. Otherwise, you would have lesser options and opportunities in working up your way as today's workforce. So keep in mind what this article had informed you about, so you know how important having a credit history is. Start a credit history as soon as possible, most especially if you are high school or university aged, so you would be ready. And be sure to handle your finances well, as well as be responsible for your consumer behaviour.

Disclaimer: This editorial content is not provided or commissioned by the credit card issuer(s). Opinions expressed here are the author's alone, not those of the credit card issuer(s), and have not been reviewed, approved or otherwise endorsed by the credit card issuer(s). Reasonable efforts are made to present accurate information, however all information is presented without warranty. Consult a card's issuing bank for the terms & conditions.
All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.
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