Based on scoring assessment, the Bank manager decides: to give you a loan or not. Express analysis of your solvency allows you to make a solution quickly. The scoring system system is constantly updated, and the algorithm is kept secret.
Surgeon system needs a creditor to assess the solvency of the future borrower. Since the profit of the Bank envoys how conscientiously the client will fulfill the obligations under the loan agreement, the creditor needs to appreciate its demographic, financial and social, characteristics at the first stages of acquaintance with the lending portfolio of the borrower.
Sources for scoring calculation are data for questionnaires filled with a borrower, credit history, as well as other information available to the bank on maps and customer accounts.
When contacting a bank with a loan application, an employee asks you to fill out a questionnaire, which is one of the components of the scoring model. As a rule, questions in the questionnaire in all banks are the same include: name, age, floor, marital status, place of work and position, as well as the amount of income.
Each of the items of the questionnaire has its scoring score, which affects the decision of the bank.
Credit history — the first thing that banks pay attention to. It develops from all the actions related to loans earlier. So, for example, if you have never made credit commitments in financial and credit institutions, then your credit history is clean. And if, previously decorated loans were paid on time, the reputation will be good.
But if in the past you had a delay in payments, fines and penny, then such a credit history is considered spoiled, which significantly reduces the scoring score when calculating the system.
The presence of a debit or credit card, an open contribution or account may affect the decision of the bank regarding the application for a loan. All of these data may be included in the scoring calculation, as the information is already available at the lender, and it can be as defined as possible.
The advantage of the ballroom system is to save time, both for the borrower and for a bank employee. So, earlier the bank manager was supposed to manually view all the questionnaires and make a decision on the loan. And now the system itself calculates the score, according to which the verdict is taken.
The duration of consideration of the application also decreased. Now it is not more than 5-7 minutes, while earlier it was left from one to several days.
The program excludes any bias of the employee and issues the score objectively, assessing human solvency.
If earlier you did not take a loan in the bank, then the scoring system is difficult to calculate the score of your solvency, since there is no information for counting. Therefore, customers with a net credit history often receive a refusal in the application.
The program estimates the customer’s responses from the questionnaire, and if the bomber is mistaken in the data filling, the system can give a small score. In this case, the human factor can play a cruel joke, as it is advised to submit a new application at the same bank not earlier than in 30-90 days.
You can deceive the scoring system, but only for a while. You can adjust information in the questionnaire to ideal: to indicate a high level of income, the availability of real estate, not specify current loans.
But this is just the top of the iceberg. But the most important thing will begin when employees will start checking documents that may not coincide with the data that you have entered. From here, often customers receive a loan failure after receiving prior approval.
Therefore, in order not to spoil your credit history, as the failures are also included in it, we advise you to be extremely honest with the bank.
As you can see the scoring system, you need a bank to quickly for yourself and to check your credit opportunities for you. To enhance the chances of a good score, we advise you to improve your financial characteristics: for example, close old loans, improve credit history and so on.
Trying to deceive the system — there is no point, since after a thorough check of the documentation by the Bank’s employees, the whole truth will pop up out.