How Your Credit History Affects Your Borrowing Options

Credit ScoreUnless you have enough cash on hand to purchase a home or car outright without financing, you may find yourself in a situation that requires you to borrow money from a lender. Your credit history becomes the most important aspect of your life in this situation, but that’s not the only time it’s important. For example, even if you do have the cash to make any purchase you want without any financing requirements, you might not be able to secure a job, an apartment, or even a rental car if your credit history is not good enough.

What Your Credit History Says About You

Your credit history is a long list of the way you use money when you borrow it from someone else. For example, if you had an online installment loan with a lender you did not pay back, it shows up on your credit history. It tells other lenders that you are not a reliable borrower. Lenders want to see that you can and will repay them if they choose to lend you money. If they see regular late payments, missed payments, or defaulted loans on your credit report, they’re not going to give you the money you need to buy a car, a house, or even a credit card.

How to Fix Your Credit

If your credit is damaged, it’s not the end of the world. It’s not ideal, but you can repair your credit by focusing your time and putting effort into it to make it easier on you. The first thing you should do when you’re working to repair your credit is to check your credit report. You should know where your problems are, and you should know if there are any mistakes listed on your credit report. If there are mistakes on your report, dispute them. Write a letter to the credit bureau explaining what is wrong with your report. If you have proof that something is incorrect, provide it to the credit bureau.

The bureau will ask the creditor to fix the problem. If the creditor does not respond within 30 days, the issue is removed from your credit report. If the creditor does respond, it’s either to fix the problem or to say that they feel they are right in reporting what they reported.

The next step is to make all your payments on time, pay down your debts, and make sure you do not utilize more than 30 percent of your available credit. Do not close credit cards if you pay them off. This lowers your available credit limit, which causes your credit utilization to rise.

How Bad Credit Affects Borrowing

When your credit is bad, you simply will not get a loan from any lender. If your credit is bad but not awful, you might be able to get a loan from a lender, but you’ll pay a much higher interest rate. This means the loan is more expensive to repay. You can always find a cosigner to help keep your rate low and to guarantee you get a loan, but many people are hesitant to cosign a loan for someone who has a rocky credit history.

If you have the cash to make large purchases, you might not need to borrow money for things. However, you must take care of your credit score. It’s the most important number in your life in terms of your finances and your financial future. Pay your bills on time, don’t incur too much debt, and be careful with your credit report.

More UK Student Property Investment Needed

mortgageAs increasing numbers of the newest, luxury loving, premium demanding generation are going off to university, the demand for high-quality student accommodation in the UK is at an all-time high.

No longer will students settle with the sub-par, damp conditions that students have had to endure for years before.

The National Union of Students (NUS) has recently conducted a survey on university students regarding their opinions of their current or past experience with student accommodation. On average, it was found that out of every 10 UK students, 4 of these would deem their privately rented accommodation as “substandard”, reporting a plethora of issues. Out of all students surveyed, 42% of these reported frequent problems with damp and insulation, whilst another 16% admitted living in houses with numerous electrical issues.

In additional to these direct issues that the students are faced with in their day-to-day living, a whopping 37% of students surveyed by the NUS stated that they have never been provided with the correct paperwork to ensure that their deposits were being held safely by the correct agency, despite this being a legal requirement for all tenants in the UK.

Student property standards increase

It is not news to anyone that there have always been numerous issues found with old-fashioned student accommodation, rented out to students by largely amateur landlords.

This type of accommodation has, for many years, been the only option for students in their second and third years of university, having to accept what they can afford in an area close to campus. However, this is now changing, and its changing quickly.

A growing number of students

Statistics released by UCAS highlights the ever-increasing number of students attending university. Proportionately, there was a 0.3% increase in applications for university in 2018, with this figure anticipated to be higher in 2019.

With a substantial 8% rise in rest of the world applicants (up to a record high of 65,440 for 2018), the need for accommodation is set to keep growing.

Interestingly, and unlike the rest of the UK housing market, the economy had little bearing on the number of students attending university. CIPD highlight this, whereby as an economy falls in an area, with less job opportunities available, the number of university applicants actually rises. With Brexit itself appearing to play little part in the demand by rest of world applicants and a falling economy, we may see the number of university applicants rocket.

An investment opportunity

With a 68% rise in demand in the last 8 years for purpose-built, modern, student accommodation, there is great potential for investors in the UK student property market to achieve high long-term returns – there are ample student accommodation investment opportunities available to investors.

Net asset value in student property was up 7.2% across 2018, according to property experts DIGS. This figure is a result of the ever-increasing number of applicants going to university, and an increase in rental price for private student accommodation.