Your Credit Bureau and You – Ten (10) things you should know
A Credit Report is a detailed breakdown of an individual’s credit history prepared by a Credit Bureau. The Credit Bureau is an independent organization that collects financial information about individuals and businesses, thereafter creating Credit Reports based on the information provided by Credit Information Providers.
Lenders use the reports along with other details to determine loan applicants’ creditworthiness. Credit reports include personal information such as the individual’s current and previous addresses, tax identification number and the number of inquiries made by Institutions among other information. These reports also include a credit history summary such as the number and type of Bank or credit card accounts, that are past due or in good standing and detailed account information related to high balances, credit limits, and the date accounts were opened.
What is creditworthiness? Creditworthiness is how a lender determines whether you will default on your debt obligations, or how worthy you are to receive new credit. Your creditworthiness is what creditors look at before they approve any new credit to you. Creditworthiness is determined by several factors including your repayment history and credit score. Some lending institutions also consider available assets and the number of liabilities you have when they determine the probability of default.
A credit profile is dynamic and subject to rapid change. Simply stating, that what is available at your current date of examination may change significantly at any time in the future as it is subject to fluctuate owing to various negative payment habits or incorrect data uploaded to your profile. We therefore recommend checking of your credit report at regular intervals you may deem suitable. After observing any inaccuracy within your credit report, you can proceed to file a dispute in relation to your findings. What is a dispute? A record of alleged discrepant information with your credit report, which can be challenged with accurate information by a data subject.
What is a credit score? A credit score is a single numerical indicator that represents the creditworthiness of a data subject. The score is simply a summary indicator of all the credit information available for assessment of a particular borrower. Creditinfo’s scores range from 250 to 900 with the highest score within the range being the least risk and the lower scores being the highest risk.
In the event your credit report does not contain a score or any credit data, this may be due to insufficient data available to calculate a score, or a lack of recorded credit facilities in your name.
Here are ten (10) additional things that you should know:
- Your Credit Report is a powerful financial tool which contains detailed information that the Credit Bureau has collected and stored regarding a data subject whether an individual or a business.
- Credit reports are mandated to be used by Financial Institution within Guyana based on existing legislation – The Credit Reporting Act of 2010 and amended in 2016. When applying for any form of credit to empirically evaluate borrowers and guide decisions on approval and terms of lending.
- Your Credit Report cannot be accessed by anyone without your written consent and your identification. Before an institution pulls your Credit Report, they are obligated to inform you, they are doing so and thereafter confirm with your signature against the consent clause within their credit application.
- Creditinfo has taken steps to ensure consumers credit data will always be safe from unauthorized access. They are no files on paper and no information stored locally in Guyana. All credit data is in digital format and stored offshore in a Tier Three Data Storage Facility, which is the highest level of security in the region.
- Credit Reports are only provided to authorized lenders that are approved by law or the Bank of Guyana. It is an offence under the Credit Reporting Act to allow unauthorized entities to access your credit information.
- Throughout your life, your credit report and specifically the score demonstrates an imperative role in how successful your application for credit will be assessed – as it indicates persons with a higher score are less risky and further considered credit worthy.
- A Credit Report containing a score permit lenders to make fast an objective decision on an applicant’s creditworthiness. Before the advent of credit scoring and reporting in Guyana, the credit granting process was slow, inconsistent and often subjective. However, lenders can now utilize the credit report to efficiently facilitate access to financing.
- Consumers are encouraged to review their individual Credit Reports and scores regularly to ensure that they have a good score, even if they do not require credit now. Creditinfo encourages consumers to “know before you go”.
- Your credit data is updated at least once every month, allowing everything a potential lender accesses to be current. This is good news for data subjects, which gives you the opportunity to repair your credit and improve the outlook of your credit report and score.
- You are entitled to one free credit report per calendar year. This report is available online. After requesting your second report there is nominal fee you will pay via MMG. Documents needed for your credit report will be 2 forms of National Identification and your TIN.