You might have to be the first personal finance instructor in your child’s life because no one else will be able to teach your children about money early enough. If you’re not sure which specific lessons are appropriate at different ages, read on. Continue reading
Lenders assess creditworthiness using a variety of methods. Some of these methods are based on financial calculations and others are based on stereotypes. Regardless of the ethics of how lenders determine whether they should lend to someone, you need to follow to their rules.
These are the main aspects lenders use to assess credit worthiness. Below are several factors that contribute to a lenders decision when applying for a loan.
A credit score is the main number lenders use to assess whether someone can borrow money. The threshold for what a suitable credit score is varies from lender to lender. However, there are few lenders who don’t use credit score when assessing prospective borrowers. You can get a copy of your credit report from one of the major credit reporting agencies.
If you happen to have bad credit it can be much more difficult for you to obtain a loan. It’s not impossible and people with bad credit get loans every day. You may have to go with a lender that specializes in these type of loans. Keep in mind your interest rates will be higher than those with good credit.
Do You Have Stable Employment?
Salary is important because it determines exactly how much you can afford to borrow. However, lenders will also consider whether you have stable employment. Stable employment puts the minds of lenders at ease because they know the borrower has an income coming on a consistent basis. The self-employed and the unemployed will always struggle to meet the standards set by lenders because of this requirement.
Age of the Applicant
The age of the applicant is always important in borrowing because there’s the idea that people of a certain age are unreliable. The elderly are on limited incomes and may only have limited time remaining, so they’re naturally considered to be more of a risk. Young people fresh out of college are also considered to present more of a risk because they don’t yet have a stable career or positive earnings potential. Those who’re considered to be of the best age are those who’re middle-aged because they already have stable careers and stable income. They’re also reaching their peak earning years.
This is all wrapped up within credit score, but lenders will still look at a person’s payment history separately. You can still have a good credit score without spending decades building up that credit score. And some people may have a higher credit score but have a poorer history of making payments. Credit score only details the short to medium-term. The long-term can be eliminated by what’s happened in the short to medium-term. Lenders want to be able to look as far back as they can. If the borrower has had payment issues before this is something that will weigh in on their decision.
Total Debt Owed
Lenders always want to know whether borrowers have any existing debts. The last thing lenders want is for borrowers to get snowed under by their financial obligations. Having too much outstanding debt could cause them to deny an application even if the credit score and credit history is good. This is because the lender is liable to lose their money if the borrower finds themselves in a financial crisis. The ideal borrower is someone who has no existing debt. It means the lender can be confident that their debt is going to be the priority.
What are the Benefits of Being Considered Credit Worthy?
It’s a myth that only a person’s credit score matters in whether they can borrow from a lender. There are so many other factors, as detailed above. Credit worthiness will give you lower interest rates and the ability to be able to borrow more money. It puts you in a better position to accomplish your goals. Plus, the repayments are likely to be lower if you’re more credit worthy.
Last Word – Focus on Improvement
Now that you know what lenders are looking for you should focus on improving your position. We’ve already discussed why this is a good idea and what it can lead to. Get a copy of your credit report as the first step and start making yourself more creditworthy today.
Employees come and go. That’s a known fact. But high employee turnover simply does an organization no good. This only means low quality performance as well as unmet expectations in the workplace—not to mention unnecessary expense for the company.
According to Chron.com, it is even more expensive to lose workers than to keep the current ones. The good news is that there are free and inexpensive ways to encourage employees to stick around.
Hiring the right people
While it is a given to hire employees with strong skills and qualifications that perfectly match the job, it is also important to consider how well they fit in with your company’s culture. If employees are not able to adapt to your work environment, chances are they won’t feel happy and content with their jobs. Aside from feeling left out, they won’t get along well with their co-workers, which might lead to poor work performance, and eventually, resignation.
During the hiring process, make sure to also dig deep into the applicants’ behavioral and cultural qualities. Find out how they react to certain situations by tweaking your interview questions into more spontaneous and unpredictable ones. Most of all, talk about your workplace culture. If your company is strict about being a drug-free workplace, don’t hesitate to inform applicants that they may need to pass a drug test, such as a THC test, before they can be accepted for the job.
Practicing work-life balance
It turns out that ignoring work-life balance in the workplace can lead to more harm than good. Aside from serious health consequences, such as fatigue and burnout, poor work-life harmony in a company can lead to low productivity and high employee turnover. With team members getting more and more irritable and less and less energized by the minute, there’s not much your business can achieve in the end. And yes, this apparently means that you need to do an overhaul on your management style.
Allow your employees to take the day off every once in a while. As much as possible, delegate projects one at a time. Giving them time to focus on themselves and their families every now and then will ultimately make them feel appreciated and cared for.
Offering growth opportunities
Employees each have different reasons for staying at a company, and aside from the perks and privileges, they often look for and stick to a job that helps them advance in their careers. You can be that company that values professional growth through many ways.
Take time to dig into their career aspirations. Once you get to know better what motivates them as professionals, apply them into the workplace. Whether it’s by paying for seminars or through challenging them with a promotion, giving them opportunities to advance will make them feel like their stay in your company is a worthwhile experience. While you can never force every employee to stay, you can always work hard to gain their loyalty as much as possible.