May 30, 2018

Reasons why you should check your credit report frequently

Information is power, thus knowing your credit report makes be able to use it if necessary. It is thus crucial for you to access your credit report so that you are aware of your current credit reputation. Knowing your standing enables you to make informed credit-related decisions in relation to your personal/business development and growth plans. It also enables you to actively manage your borrowing and repayment behavior with an intention of achieving and maintaining an attractive borrower profile.

Arm yourself with information that you can use to negotiate for the preferred credit terms. A credit report has a score which summarizes a borrower’s credit behavior. A good borrower, usually characterized by consistent and timely repayments will have a higher score and vice versa. Therefore, a good borrower who routinely checks his report can approach a lender and negotiate for better loan terms like reduced reliance on tangible collateral, friendly repayment schedules, lower interest rates and faster turn-around-times in loan processing times, among others.

To ensure the correctness of your information, frequently access your report to give yourself an opportunity to review the information contained therein and ensure correctness. While doing this, pay attention to the correctness of your personal details like name, contacts, ID number as well as the summary of a your loan accounts and their status. This includes loans a borrower’s loans that are being repaid satisfactorily as well as those whose repayment status is unsatisfactory or in default.

Identify and remedy any errors in your information, by checking your report to verify the correctness the information, you can also detect any errors in the information before they disadvantage you in regards to any future loan-related matters. Early detection of such errors shields you from being affected negatively by lenders and other institutions, when they check your credit report to make lending or hiring decisions, among others. CIS Kenya has set up a CIS Mediation Centre for resolving CIS-related disputes that arise between borrowers, lenders and the CRBs. The mediation center is known as Tatua center where issues are handled within days instead of the old fashioned way of going to court and spending way too much money and wasting a lot of time.

Detection of loan application fraud: in some cases, identity thieves can ‘seize’ you identity and use it to take loans under your name. If the loan is granted, the lender holds you accountable for the loan since your identity and the related documents were used in making the fraudulent application. However, by routinely checking your report you can know and quickly report suspicious loan information, thus absolving yourself from such fraudulent loan applications.

Therefore, always make it a habit to frequently check your credit report with either of the licensed CRBs (Metropol, CreditInfo or Transunion Africa). Remember, you are entitled to ONE FREE CREDIT REPORT per year from either bureau and thereafter subsequent reports can be obtained at a minimal fee. The CRBs require basic documents like your original ID and KRA PIN Certificate to verify your identity before issuing you with your credit report. So go and check your report today.


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