If two of your siblings want to borrow some money from you , one of them is very  responsible- a saver and spends mindfully while the other one is just opposite but is really in need of the money . Which one is more likely to get money from you? How do you think banks and other lending institutions decide to whom they should lend their money; how do they find out the          identity of their borrowers?

Bad credit:

As we all know for better opportunities and for the welfare of our family every person have      to take a loan taking loan is not bad but not repaying it on time is some time could have destructive sometime, repaying is in your hand always so a person could take some measures to avoid a credit to turn into bad credit like he/she can adjust the amount of installment of credit according to their current financial situation we all know that a person with bad credit will find it difficult to borrow money especially on interest rate but a person can improve their bad credit here are some steps you can follow to improve your credit he/she can always enable automatic payment system it partially improve your on time payment it sets an email/SMS on phone to get a remainder to pay at least minimum payment time every month and by doing payment on above the minimum due to whenever possible it gradually decrease bad credit situation. Visit https://money-wise.org/bad-credit-loans-missouri/ for complete details.

Credit score is your financial identity

Credit score is based on your credit history, income, repayment history and other factors . Generally people with a good credit score are given loans at lower interest rate. On the other hand if you have no bank account or have a bad credit history you are most likely to have no access to loans or you might get a bad credit loan – Bad credit loans demand higher interest rate. Now if you go back to the question that I had asked and you decide to lend your money to the one  who needs it but is unlikely to repay it on time, you would either set some criteria , set a deadline or ask something more than the amount you had given . This is called high interest rate.