Wrong assumption: bad payment behavior has no consequences
Bad payment behavior will never be without consequences, that much is clear. It can be assumed that around half of all Swiss people believe that a warning can be paid and that there are no further consequences. But far from it! It is rather the case that a delay in payment is registered directly and has an impact on the overall creditworthiness. Of course, such entries have a particularly negative effect when it comes to granting loans. These are rejected or only approved in a low amount if poor payment behavior has been certified.
The following two terms are used to assess creditworthiness:
- credit rating
The creditworthiness provides information about whether the customer can pay. If his current budget allows all income and expenses that are compared to the fact that the remaining amount can be used to repay a loan, this should be assessed positively. The possible loan amount is also based on this. Important: In order for the creditworthiness to be checked in the first place, the applicant must have a freely disposable income, be of legal age and be able to repay the loan in 36 months.
- credit-worthiness
Here the probability is calculated whether the customer will repay the loan. It is about its trustworthiness when it comes to payments, using open liabilities and even debt enforcement that has already been completed. In addition, age, nationality, place of residence and the frequency of changing jobs also play a role. Banks get the necessary data from creditworthiness databases, debt enforcement offices and the central office for credit information.
Intrum Justitia, Bisnode, CRIF and Creditreform are the major credit bureaus in Switzerland, but they are not only asked for information when granting loans. Inquiries are also made here when it comes to online orders and payment in installments or by invoice. Even the wish for a new cell phone contract is registered here! The creditworthiness is also negatively influenced by slow payments, it does not even have to be reminded. Such a rating is intended to protect the borrower from over-indebtedness. At the same time, the bank naturally wants to protect itself and protect it from default.
How creditworthiness influences lending
In summary, it can be stated that the creditworthiness is significantly involved in the decision on a loan. Credit approval or refusal depend on it, with all banks applying different rules for assessing the applicant's creditworthiness.
They also do not allow themselves to be looked into the cards and do not publish such regulations. Tip: Before you make a loan application, it makes sense to get an overview of your own creditworthiness so that no rejected loan application further deteriorates the creditworthiness.
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Source: comparis.ch
