For many years we have had a credit scoring system which businesses have used, which is quite frankly not always fit for purpose. In the main this traditional system gets it right, but there are many people who simply don’t get fair treatment. It is for this reason why more and more companies are looking at using alternative credit decisioning software when they assess whether or not their customers are able to obtain credit, and how much they should lend.
If you have been rejected credit then it may have been done unfairly, and here is how new software can help you to get the credit you need for your next purchase.
First Time Credit
If you are looking to get credit for the very first time then you would think that you could be an ideal candidate. Unfortunately however previous credit scoring systems would have rejected you outright because of the fact that one of its metrics is how you have handled credit in the past. As you can imagine this offers something of a vicious circle, because how could you possibly prove yourself if credit is never given? New credit scoring software however understands this problem and whilst you may not be able to borrow huge amounts, if you are on a low salary and it is your first time, you will be given a chance to prove yourself.
Another popular reason why people are rejected for credit is that they have made mistakes in the past and poorly managed their finances. It is understandable to reject someone who has mismanaged debt before, after all they do pose something of a risk. Having said this, rejecting someone who made those mistakes many years ago is simply unfair and that is again why this new software is much better for helping businesses to learn exactly how trustworthy their customers are. Many young people aren’t equipped to deal with debt and that is why they may have run into problems in the past. At some point in the future however they do deserve a second chance and once again this is why new and alternative credit scoring software won’t refuse someone outright. This is of course assuming that a sufficient amount of time has passed.
Bringing Back Credit
Credit and debt are often seen as dirty words but the reality is that the world and the economy require people to have debts and to borrow. The key to all of this is that they have debt which is well managed and which is within people’s means. Something very damaging which the old system did, was allowing people to borrow well over heir means in some cases, based purely on salary. New software systems will not allow this to happen and that is why we are able to bring back responsible lending through this approach.
If you have been refused credit then finding a company which uses new and improved credit scoring systems is essential for you.