Minimum required credit score is very important when applying for any credit in South Africa, Let’s be honest the first thought that comes to everyone’s mind before applying for a Personal loan is the consent of their creditworthiness not knowing if your loan application will be approved or not due to your bad credit profile.
Having a bad credit history and not having the minimum required credit score for a loan can definitely decrease your chances of getting the loan amount you desire, it can affect your repayment term and in some cases you would not qualify for the personal loan.
What Causes a Bad Credit Score
When borrowing a personal loan from a bank, a financial institute or any credit provider they will check your credit score and see how you manage your debts and through your credit score they will see how you handle your personal loans.
If you have done the following to your current or previous credit provider you will have a bad credit score or credit profile.
- Enquiring Credit Frequently
- Bankruptcy Declaration
- Backtracking on payments
- Not making monthly repayments
Minimum Score to Qualify for a Personal Loan
Many financial and credit providers in South Africa will require you to have at least the minimum required credit score in order to qualify for a personal loan and a credit score that can be considered as the minimum required or good score is 550. Having this credit score can better your chances of securing a personal loan.
An excellent or very good credit score can be advantageous because loan lenders and other financial institutes will notice how well you handle your debts and give you better offers on any credits you apply for.
The following should simplify your understanding of credit scores
- 670-740 – Excellent Credit Score
- 650-669 – Very good Credit Score
- 603-649 – Good Credit Score
- 528-602 – Fair Credit Score
- 0-527 – Poor Credit Score
How to Improve your Credit Score
Making your credit score better should be taken into consideration because we all know life has its own ups and down you will never know when you’ll need some financial assistance, paying out all your outstanding debts while you can will improve your credit score, multiple credits must be avoided because they can affect your credit score, and always check your credit profile to monitor any unlawful activities that can affect your credit score.
you can check your credit score here
