About Personal Finance
Today, libyza we’ll talk about personal finance. And now, when you apply for a mortgage, loan or other kind of credit, the lending industry will automatically scrutinise your personal credit history. In practice, you not very need to tell them anything as within a fraction of a second, the lenders computers will lock in to your credit file held by any one of the giant two credit agencies; Experian, Callcredit or Equifax And you’ll be amazed what they know about your finances!
For lots of years now banks, building societies and other lenders have been providing information about your finances to the credit agencies. They know about every credit applications you have made, the occasions you have been late or missed paying a loan, mortgage or credit card, the balances on your loans and credit cards and whether you pay off the maximum each month – even your credit limits! The agencies also accumulated lots of other information about you provided by public records, the voters’ roll and the public register of court actions where all county court judgments are recorded. Their computers then statistically analyze all this information and evaluate your application. So in this context, the credit industry argues that the more information they have about you, the more exactly lenders can make lending decisions.
Yet within this mass of information, there is one notable omission. Despite representations to the government, information about student loans and their repayment history’s, is not provided to the credit agencies. The information is refused because student loans are a debt to the taxpayer, not a commercial business.
Prior to September 1998, graduates repaid their student loans by mortgage style direct debits collected four times the graduate started earning over £15,000. But over 59,000 of graduates from before 1998 graduates are understood to be in payment arrears to the tune, on average, of around £2,750 per graduate.
After September 1998, the method of collecting student loans changed. These days, repayments are deducted directly from salaries by employers along with national insurance and income tax. This method is far more efficient and avoids the chance of bad debts.
