Posted by: islamicfinancingnews | October 8, 2012

Consider your credit score when applying for Islamic mortgages

When you are interested in applying for proper Islamic finance that includes Islamic mortgages, you should be aware that your credit score will be considered seriously by any Islamic finance lender in order to assess whether you are a borrower that demonstrates a readiness to repay the loan by showing responsible credit management.

Both positive and negative information from your credit report go into making up your credit score and this can include such things as your current level of debt, the different kinds of credit you have and whether you have ever made late payments or missed payments completely. In addition, some parts of your personal credit history matter more than others in comprising your credit score. For example, your payment history and current amounts owing on the credit you use contribute towards a higher portion of your score than the types of credit available to you such as credit cards, accounts with retail stores, or loans repayable through installment plans.

Although late payments can lower your credit score, improving payment patterns such as making payments on time or paying more than the minimum balance owing can work to enhance it. You can make sure the information is correct by obtaining a copy of your credit report and resolving any outstanding issues before applying for the best rates and terms available for Islamic loans.

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