Personal Loans and Credit

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How Personal Loans Can Affect Your Credit

You probably already know that your credit history plays a critical role in determining whether you’ll be approved for a personal loan, how much you’ll be approved for and the interest rate you’ll receive. Because so much depends on your credit, it’s a good idea to learn about your credit score before applying for a major loan.

At United Teletech Financial, we believe in sharing—in listening, teaching and giving our time to help our members understand their loans and the factors that determine them.

Credit reports show lenders information about you, including the basics such as your birth date, current and previous addresses and jobs, and your spouse’s name if you’re married. They also list all of the credit relationships you have, from your student loans to your store credit cards, as well as any major financial problems you may have experienced.

Is It Possible to Get a Personal Loan With Bad Credit?

It can feel stressful to know that a lender will be looking at your credit score—especially when your financial future is on the line. But you should know that hardly anyone has perfect credit.

In fact, the most recent statistics published by FICO show that only 1.6% of people in the United States have perfect credit. And, for the 98.4% of people who don’t have perfect credit? Studies have shown that, when asked to guess their credit score, most people think it’s worse than it really is.

If you do have some financial problems in your past, don’t give up yet. Lenders generally place more importance on your recent credit history than on things that happened in the distant past. So, it is possible to get a personal loan even if you have “bad” or less-than-perfect credit.

How Getting a Personal Loan Affects Your Credit Score

Getting a personal loan can also boost your credit score. Building a history of regular payments, and then completely paying off a loan will generally increase your credit score.

Of course, you want to make sure that you can afford to pay on the loan without missing payments. If you have too much debt compared to your income or if you miss payments, a personal loan can have a negative effect on your credit score too.

Sometimes people even take out small personal loans to help increase their scores. If you don’t have much of a credit history, taking out a personal loan and paying it off is a great way to boost your credit score.

Get a Personal Loan Fast. Apply Today.

Experience the possibilities with personal loans by United Teletech Financial. To get started, apply online today. You can also call us at 866-462-5532 to talk with us about your personal loan needs.

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Apr=Annual Percentage Rate. Rates include a 0.25% discount for electronic payment from a United Teletech checking account. Max loan amount = $35,000.