Loans and credit cards have a positive effect on Credit Bureau scoring
Anyone wishing to apply for a loan or credit card needs a certain Credit Bureau value so that banks can issue the loan or hand over the credit card. There are also loans without Credit Bureau, but these can only be obtained up to a certain amount and on poorer terms. Credit cards are now also available without a Credit Bureau query. However, these do not have a disposition frame and must be charged before use.
Credit Bureau scoring table (for banks)
|Rating level||Credit Bureau Score||Probability of failure|
|M||0 – 76||42.40%|
The higher the Credit Bureau Score value (as can be seen in the table above), the sooner loans are granted and often on much more favorable terms. So if you want to apply for a loan, you usually want the Credit Bureau Score to be as good as possible so that the loan is not only granted but is also available on better terms.
Many people think that they have worsened their Credit Bureau Score value due to old, already paid off loans or credit cards. But the opposite is the case. If loans were repaid in full and without incident, this increases the Credit Bureau value, because it has created trust because you have shown dutiful behavior. It also proves that you are able to pay off a loan.
Having a credit card (with a credit card) is also proof of your credit rating. A credit card with a credit line will only be issued if the creditworthiness is sufficient. So even having a credit card, if you are not noticed negatively by late payments, has a positive effect on Credit Bureau scoring.
However, you should not have too many credit cards, as this creates a negative impression and a lack of continuity. Frequent account changes, credit card or loan cancellations also have a negative impact on the Credit Bureau Score value to be calculated.