This is how credit reporting works when you borrow

You’ve probably heard of the concept of borrowing without IC. What IC stands for in this context, however, is not everyone has control. Many people think it is synonymous with credit reporting, but that is not the case. Regardless of whether you apply for a loan with or without IC, the lender will request a credit report on you. However, when you apply for a loan without IC, the lender instead requests credit information from other credit reporting companies – companies such as Bissmode and Creditgood.

There are benefits to applying for a fast loan without IC, but there are also some differences between whether it is done with Bissmode or Creditgood. Here we go over what these are so that you can make an informed decision when applying for a loan.

Why apply for a loan without IC?

Why apply for a loan without UC?

IC stands for Ippocenter and is the largest credit information company in Sweden. The company is largely owned by the Swedish major banks, which is why they turn to IC just when they are going to process an application. All information is registered in IC’s register for up to 1 year and can be viewed by other lenders every time a new information is requested.

To clarify:

  1. You apply for a loan from a fast loan company and a credit report via IC is made on you.
  2. Some time later, you apply for a loan from another loan company that also uses IC. This company can then see that the first lender has made a credit report on you, which “reveals” that you previously applied for a fast loan.

The more credit requests made, the more reluctant lenders may be to grant you a new loan. Using IC can therefore reduce your chances of getting a loan in the future, but also affect your housing situation when landlords also request credit information. A history of quick loans can discourage them from renting out to you despite the payments being made.

Different valuation models

Different valuation models

On behalf of the lender, the information company collects information about you from actors.  The company then analyzes this information to find connections and patterns that can be used to determine your credit rating, which is the same as your future ability to pay.

To obtain a credit rating, the companies use different valuation models, or scoring models. In these models, all factors that are considered to be significant are scored, such as age, income, marital status and payment notes.

Credit rating at Bissmode

Bissmode was founded in 1989 and is a Swedish company, but operates in several countries around the world. All credit information made through Bissmode remains in your register for 1 year in the same way as with IC. The number of requests is included in your grade.

The model Bissmode uses ranks your ability to pay between 1 to 10 at 5 intervals:

  • 8 – 10 = Good credit rating
  • 5 – 7 = Creditworthy
  • 2 – 4 = Poor credit rating
  • 1 = Credit is not advised
  • 0 = No credit rating can be given

0 in the rating is given to people who have a current debt balance and where a failed attempt to foreclose.

The My Information app allows you to see your credit rating at Bissmode and also get notifications if it should change.

Credit rating at Creditgood

Creditgood is a Norwegian company, but, like Bissmode, has offices in several parts of the world. The company was founded in 1997 and is thus the youngest in the gang, but claims to be the most used credit information company in the world. Unlike Bissmode and IC, the number of credit requests from Creditgood will neither appear nor affect your rating.

The valuation model Creditgood uses consists of a scale from 1 to 100 at 4 intervals:

  • 70 – 100 = Very high ability to pay
  • 40 – 69 = High ability to pay
  • 20 – 39 = Medium ability to pay
  • 1 – 19 = Low ability to pay

Through the Tick app you can see your credit rating at Creditgood and also get notifications if it should change.

Which option is best?

Which option is best?

On the whole, all credit reporting agencies work the same. They analyze information about you that can affect your ability to pay and then give the lender a rating that represents your credit rating. However, one important difference is that Creditgood does not base its rating on how many applications you have made. In their system, only the credit information for the lender or bank that ordered it is visible, which means that the number of loans will not reduce your credit rating.

Bissmode acts as IC and registers all inquiries, but since most companies use IC, it can still be advantageous to take out loans with Bissmode. The credit requests registered there will not affect your IC rating in the event that, for example, a landlord would request a credit report from you via IC.

Use our comparison service to easily see which lenders offer fast loans without IC.

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