I want to take out a personal loan. But around five years ago I had some default repayment issue on my credit cards, which all I settled gradually. But now am concerned, will this issue be highlighted in my credit history, which might stop me from getting the loan. Should I check before applying for a new loan?

Indeed, it will be prudent to check your credit report before requesting for a loan, as it arms with your creditworthiness and financial affairs. It will certainly, help to identify where your credit rating is positioned and embolden to take necessary steps to offset the red dots (if any) prior applying for the loan.

Since you mentioned around five years back you faced default repayment issues, which was gradually settled, hence it would not be reflected, as Al Etihad Credit Bureau (AECB) the UAE’s official credit bureau, will provide the credit report which will have a record of current and previous payments activities for the last 24 months. Accordingly, if there is any outstanding amount or payment or cheques default during that particular period it will be underlined.

This report records your current complete debt levels and financial obligations, including personal, credit cards, car or mortgage and displays the outstanding amount, credit limits on the cards and the repayment performance, which certainly supports banks to make a decision on the application. The bank has centralized access to all the information that the other banks have provided regarding the individual applicant. This will allow the bank to check whether the borrower has reached the debt burden ratio in the calculation of the annual income or not. And at last, the bank decides whether to approve the loan or assist in fixing a rate depending on individual lending and credit criteria.

However, this report empowers a stronger approach to planning for future borrowing, financial management, and ensure you uphold good repayment profile to improve future credit prospects. To obtain the credit report copy, one needs to submit the AECB credit form along with the Emirates ID and a passport copy, with a minimal fee of AED 110.

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