Personal Line of Credit

A Personal Line of Credit can be easily obtained given that you qualify with good credit scores, a solid work history and the ability to repay the line as you use it.

What are the Credit Scores Needed to Obtain A Personal Credit Line?

The Scores for an Unsecured Personal Credit Line are higher than those needed for a Secured Credit Line and that is because on an Unsecured Credit Line, you are not giving the lender any security to take if you don't pay the Line back. Think of it this way, when you buy an automobile, the finance company has many incentives to allow you to borrow with low credit scores, but the biggest incentive that they have is repossession. If you don't make your payments, they'll take the car back from you.

On an unsecured line of credit you need at least a 680 credit score if not 700. Some lenders are even requiring 720+ scores to grant you an Unsecured Line of Credit, but there is a perfectly legitimate reason for that - the sub-prime crisis. If you have a big mortgage and you also want an unsecured loan, you are going to need two very important qualifiers. Number one is a great credit score so that the lender feels that your risk of default is low and secondly, you must earn a lot of money, so that you have the excess cash necessary to pay the interest on the line as well as pay the line down from time to time (although they will make more on you if you carry a large balance) we suggest that you pay your lines down as often as you can to save on interest.

What do you Mean by a Strong Work History to be Approved for an Unsecured Line of Credit?

While each lender is different and each have their own criteria for loaning money, a strong work history can not be discounted as something that they may not look at as part of your entire financial picture. Some of it has to do with proprietary stability formulas while we believe that some if it may be your earnings ability going forward. It may sound like age discrimination, but on paper, a 75 year old usually doesn't have the same earnings potential, especially if retired, as a medical student just graduating or a doctor who has been practicing for 10 years. Those are just examples to hopefully symbolize the difference in work history. It may not only be how long you've been on the job (although for a stability factor) we would imagine the longer the better, but there may also be systems that look at your future capacity for earnings to decide on whether or not to approve your loan request and for how much. One thing we do know is that a lender wants to know that you have the means to pay them back and if you are on an upward slope in your earning, we know that can do nothing but be neutral or help, as it certainly can't hurt.