What is the Credit Bureau?
The Credit Bureau is for many a taboo subject - there are those who believe it to be a kind of credit “police”, others believe it to be a kind of government agency, but, in fact, it is simply a private institution that gathers information on credit extended by financial and non-financial institutions.
The Credit Bureau is a Mexican company dedicated to integrating and providing information prior to credit being extended and whose main objective is to record the credit history of individuals and companies that have obtained some form of credit, financing, loan or service.
The Bureau issues 140,000 reports per month to those people interested in becoming familiar with how their credit payments have been recorded. According to company figures, 40% of the population has some record due to having applied for financing, and contrary to what many believe, having a report is not a negative thing, in fact, having a good (credit) track record can even open doors for an automobile or mortgage credit, because a positive payment performance portrays you as an attractive prospect.
CNN Expansion published the following information a few weeks ago about how the Bureau functions and how it can benefit you:
1. As a credit user, you may request your Special Credit Report via the Internet, fax or directly at the Bureau offices once a year and can even take out an alert system that notifies you when there is a negative record.
2. This report shows bank loans and those from non-bank financial institutions, as well as credit given for services such as subscription channel (pay) television, monthly-payment type (contract) cellular telephone service, department store credit, and your house rent if your contract is signed with a company belonging to the Mexican Association of Real Estate Professionals (Asociación Mexicana de Profesionales Inmobiliarios, abbreviated AMPI in Spanish).
3. The reports contain information on the institution that extended the credit, the balance due, and whether the account is current or has been cancelled.
4. When your payments are current, the credit “traffic light”, so to speak, is green; a “yellow alert” is issued when your credit shows a delay in payment of 1 to 89 days; and a “red alert” is issued when the delay in payment is over 90 days, and the grantor then classifies same as an “unrecoverable debt”.
5. The Special Credit Report includes a history of your past 24-month payment performance.
6. The credits extended will be part of your record for a specified period of time:
* Debts less than or equal to 25 UDIs* (117 pesos) remain on record for one year.
* Debts over 25 UDIs and up to 500 UDIs (2,346 pesos) remain on record for two years.
* Debts greater than 500 and up to 1,000 UDIs (4,693 pesos) remain on record for four years.
* Debts between 1,000 and 400,000 UDIs (up to 1.8 million pesos) remain on record for six years.
* Debts greater than 400,000 UDIs are not dropped from the record.
7. A word of caution: If you decide to stop paying in order for your record to “disappear”, you should be aware that this may not be a good idea because a person who has an old record with the Bureau and who has gone a long time without new financing recorded is deemed a bad payer.
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