What If You Do Not Have A Credit History At All?

no historyYour credit history or rating is your score on your credit report, which is formed by taking into consideration how you have done with your credit related matters in the past. When you take a loan or a mobile phone contract, your approach to the obligations that come along with these is assessed and used to determine the credit score on your report. If you have consistently struggled to meet interest payments or loan repayments, this would go down as a black spot on your report, indicating you to all the interested parties as a high-risk, non-creditworthy individual. The effect of being consistent with payments is the exact same. Either way, what you do is reflected on your report and forms what is known as your credit history. 

As you can see from above, your credit history is formed by taking into account how you have done with your credit related matters in the past. It is formed by looking at your consistency in meeting your obligations towards them. This means that if there is a missing piece in this jigsaw, the ultimate result cannot be reached. This is what happens when you do not have a credit history at all. Not having a credit history comes as a direct result of not engaging in credit dealings at all. If you have kept your safe distance from loans, mobile phone contracts, and other credit related matters, you are in a situation where there is virtually nothing for any interested party to judge your creditworthiness. It is only logical, as you cannot tell how a person is likely to do in a situation he has never been in.

Lenders and other interested individuals look at this situation as a foggy screen, where you cannot tell whether the person in context is or is not creditworthy. In such a situation, there is reluctance in how they react and thus, this has been seen as the reason behind failures of many to clear credit checks. In such a situation, if you are looking to go for big loans or other major credit related matters, it is likely that you are going to struggle. Therefore, the key here is to start slow and start low. Start by getting smaller loans and prove your creditworthiness. Not just meet your interest payments, but meet them in time, while also ensuring that you are also repaying your loan. If you cannot get a very delicious contract for a recently launched smartphone, start by getting a smaller one.

While these steps will help you build up your financial reputation and eventually lead you to your ultimate goal, the process is certainly not the fastest. However, to the relief of those reluctant individuals who do not wish to go through it all, humans have always found their way to shortcuts, and this situation is no different. If you have no credit history to fall back on, the only other way you can get what you want is through these no credit check mobile phones and other such products, which do not take into account your past dealings. This means is that while normal protocol dictates running a credit check, these products take this variable out of the equation, guaranteeing you your mobile phone contract, loan, or whatever it is you applied for.