Credit score
The Company makes decisions on granting business, agricultural and mortgage loans through credit analysis, with an individual approach, and decisions on consumer loans are made automatically using mathematical models, using a score.
One of the main factors influencing the decision to grant a loan is the credit history and credit score. These scores are important, because when making a decision to grant a loan, the Organization studies the applicant's credit history and assesses the borrower's responsibility based on it.
Credit history is a set of data on loans that have been and are being serviced by you. Credit history can affect the decision to grant a loan and includes information up to 5 years old.
A score is a comprehensive assessment of creditworthiness calculated by analyzing your credit history, expressed on a clear scale. It depends on a number of factors (but not limited to): the number and amount of loans received, payment history, and the number of new loan applications submitted.
The internal score for different types of loans is periodically reviewed based on historical data, with the aim of presenting up-to-date and accurate information.
The internal score depends on:
Credit burden: number of active loans, amount,
Credit history: number, amount, type of repaid loans, past due dates, payment history, duration of credit history (delays in payments may reduce the score)
Age: according to the terms of the relevant loan type (age threshold: 18-70)
Income: amount of registered or estimated monthly income
In case of loans secured by collateral, collateral and market value
To improve the score, the borrower can:
Relieve the credit burden by repaying active loans in full or in part
Make repayments on time, excluding delays and be punctual
Reduce the number of guarantees provided, the presence of overdue obligations
Ensure repayment of overdue amounts in terms of guarantees and avoid becoming a guarantor for unreliable persons
Exclude even one-day delays in fulfilling obligations on current loans
Avoid frequent requests for new loans applying, it reduces the credit score
The Company also takes into account the external FICO score (developed by Fair Isaac Corporation), also a comprehensive assessment of credit risk, the components of which are:
- Payment history (35%),
- Credit burden size (30%),
- Length of credit history (15%),
- Types of loans (10%),
- New credit application (10%).
You can learn more about credit history at the following links: www.abcfinance.am, www.acra.am
In case of detecting errors or shortcomings in the credit history, the client can inform the credit bureau for clarification and correction or directly contact the financial organization that transferred the information to the credit bureau.
The organization sends information about the client to the credit bureau within a maximum of 3 (three) business days, and current information about the loan is regularly updated throughout the entire period of the loan. The client's credit history is formed in the credit bureau based on data received from all lending financial organizations.
The client has the right to obtain his credit history from the credit bureau once a year free of charge.
You can learn about the "Financial Assistant" system at the following link: www.fininfo.am
