Why Investors Should Take the Advice of Credit Rating Agencies

Credit rating agency gives the rating to the company’s ability to pay back the debt. Or in other words does company has the ability to give back the money in future that was borrowed in past.

The rating agencies are important part of the financial market, because they give investors and debtors insights about the company performance.

The credit rating agencies comprehensively examine the share market listed companies, after examining, they exhort the investors indirectly that should they invest in the company or not? They provide you the insights about the company, which aids banks and creditors, to loan the company or not. So indirectly they play a vital role in the corporate world.

They analysis the overall financial condition of the company, top management, current legal issues with government and backs, political relationship with the government so that investors can take the wise decision before making investment.

As per the research credit rating agencies have been very helpful in United States of America.

For instance if rating agencies give the higher rating, it means the company is investment friendly. Or if company gets a low rating, then it implies you are investing on your own risk so as to avoid risks rating agencies try to make comprehensive assessment about the company growth.

They try to create the transparency in the financial market, and rightly examine the financial condition of the company.

These agencies also monitor the soundness of the borrowers by their own methods. Each rating agencies in India has own assessment and evaluation process. For that they employ professional staff who can measure the risk in feasible manner.

They use the secret information about the company while assessing the company details. They gather information from secret sources, then analyses and interpret information, and for investors it is not easy to evaluate the company’s credit. That is the reason investors have trust on these agencies.

The higher rating of the company implies that it is good for making an investment. The business of credit rating agencies is totally dependent on the right analysis, therefore they don’t make wrong conclusion or indirectly involves with the company because one misjudgment damage the reputation of the rating agencies. So as to maintain the credibility they don’t indulge in any fix up.

Hence majority of investors don’t have the analytical knowledge, but the credit rating agencies provide the right analysis and report about the company’s financial status, and this helps the investor to make the right investment.

The author of this article is a consultant at one of top most Credit Rating Agencies. There are many rating agencies in India that provide the good advice to investors.

Credit Rating Check: Top Three Ways to Boost Your Credit Rating

Your credit rating is calculated by a credit reference agency. The agency will carry out a credit rating check by compiling information based on a variety of sources, such as the electoral role, financial data and court records. This information is sold onto lenders who will use it to decide whether to lend money or what deals to make available to the customer.

While some people are given bad credit ratings due to defaults on payments or other dubious financial activity, other people cannot obtain a good credit rating despite a consistently reliable financial history. Reasons for this can include not having borrowed money before, giving a lack of evidence to show reliability, not being on the electoral role and having moved house often.

If you have been given a bad credit rating and want to improve it, you can check your own credit report and ask for any mistakes to be amended. If there are no mistakes but you are still registering a bad credit rating, you can start off with these three steps and you’ll soon be on the road to a more favourable credit rating check.

1) Register to vote

If you are not on the electoral role, credit reference agencies may not be able to find you. Without being able to measure your credit rating, financial institutions will be reluctant to lend and you may have trouble getting the mortgage, loan or bank account you’re after. If you register to vote, you will then be on the electoral role. This means that the agencies can conduct a credit rating check on you.

2) Cancel unused credit cards

While it is good to have a credit card as long as you pay off the outstanding balance in full each month, having too many credit cards at once can be bad for your credit rating. Cut up and throw out any credit cards you don’t use as closing these accounts, along with any unused bank accounts, can have a positive effect on your credit rating. Once you’ve done this, contact a credit rating agency and tell them you have closed the account to make sure it has been removed from your file.

3) Pay your bills on time

This rule applies, as you would expect, to credit card payments and loan payments, but also to any other bills. It is good to have utility bills in your name as this shows you have a fixed address, which is good news for your credit rating. However, once these are in place, it is essential to pay all bills on time. Phone, gas and electricity bills, for example, are forms of credit so not paying these on time will show up when it comes to a credit rating check.

It can be helpful to use direct debits to ensure the payments arrive in time, this can also save money on the bills themselves. If you choose this option, always make sure there is money available in your account to pay the direct debits on the designated dates.


Other important measures to take include having a landline, as this shows you’re secure and at a fixed address, and making sure you fill in your details correctly on any application form which is related to getting a credit rating related loan, mortgage or account.

Credit Choices helps you make a credit rating check and gain advice and information on how to improve your credit rating.

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You Can Purchase Your First Home Without A Credit Rating

Long-term value fluctuations in a property are a common concern for people looking to purchase a house or other real estate. Read on for some valuable tips.

Use caution when buying a home that is on the short sale market. There are so many parties that are involved in this type of transaction that makes it easy for something to go wrong before you gain the deed to the home. Be prepared to lose the home that you think you may be winning at auction.

Buying a home? Need a mortgage? Many lenders will require you to set up an escrow account at a bank or though the lending establishment. This account will hold the money from your monthly mortgage payment that is going to be used to pay the property taxes on your home. It is a way for the lender to be sure that the home will not be lost at an auction because of unpaid taxes!

One important tip when it comes to real estate is to go to as many open houses as you are able to – even for houses that you think you would not be interested in. This is important because you might gain some house hunting knowledge or tips that you would not have learned otherwise. Also, online ads may be deceiving, and you may find that the house is nice after all.

Meet with a lender prior to looking at homes. Ask about the available loan options so you will get an idea of how much cash out of pocket you will need for closing costs, down payments, and any other fees. You may find yourself surprised at the amount of money that you may be able to afford due to the low interest rates.

When buying your first real estate property, you should be aware that there are many programs that are designed to help you as a first time buyer. Check with your real estate agent to see what state or federal programs that you might qualify for. Some programs help with the down payment, while other programs reduce your interest rate, to help make it more affordable.

Know your budget before you start shopping for a home. Experts recommend that housing costs not exceed 30% of monthly income. Be sure that you have plenty of room in your budget for unexpected expenses such as repairs or remodeling before committing to a loan. If it seems like too much of a stretch, it is probably too expensive.

If you are interested in buying a home it is important to know exactly what you are spending your money on. Purchasing a home inspection is an option, but you should have a trained expert go through the house and ensure that everything is working and in good condition. You don’t want to buy the house and then have to spend a lot of money replacing the roof, heating, or air conditioning system. Spending a little money up front can potentially save you a lot in the long run.

When you are considering a home, you should look into the different rules that the association has in place and if you would want to abide by them. Some could be as strict as telling you when you have to plow the snow, water your grass, or what your lawn has to look like. By looking into this, you will know if you actually want to deal with an association based on how strict they are.

A lot of people who want to buy a home do not realize that it might have complications. Use this advice when buying property.