To know whether banks should trust you with their funds, they look at your Credit Score. It’s basically the ratio that shows how trustworthy and responsible you are, when it comes to money.
Maintaining a good credit score is crucial and instrumental in forming a healthy profile, and is built on several factors.
So, what does it take to maintain a healthy credit score and therefore a good profile?
The most important factor in determining a sound credit score, is to always pay your bank instalments on time - even if it’s just the minimum payment. So, it’s a good idea to pay your bills before they’re due, and never miss a payment!
Another key point is the amount of money that you owe. As a rule of thumb, it’s a wise decision to try not to have debts that amount to more than a third of your salary, that way banks can see that you don’t accrue credits that are larger than what you can afford to pay back.
One more factor that goes into the calculation of your credit score, is checks. Rule number one is to never issue a check, without having enough funds in your bank account. This will also boost your credit score a notch.
Finally, it’s not a bad idea to always have a reasonable amount of money within your account that will serve you in case of unexpected payments, dues or emergencies. This will also show banks that you have a responsible financial attitude.
How do banks check your Credit Score in Lebanon?
When you request a loan from a Lebanese Bank, they have to go through the Centrale des Risques - or CDR - which is located within the Central Bank of Lebanon. The CDR is responsible of keeping a record of everyone’s financial activities, and most specifically credit activities. The CDR shares financial information with private institutions and banks, when needed.
And there you have it!
We hope this information will help you keep a healthy credit score, which will allow banks to trust you, and to grant you with loans, if need be.