Having a lot of money in your savings account doesn’t necessarily mean that you have excellent credit. In fact, credit rating is not an indicator of your wealth but the status of your credit file.

Here are some of the reasons why a person still gets a poor credit score despite being cash rich.

Zero to thin credit history

Don’t be shocked when credit card providers and banks turn down your applications despite having been financially responsible. A limited credit or zero credit history doesn’t sit well in your credit report. You’ll end up having poor credit score which makes it challenging to get the most affordable credit deals.

While “no credit” is not the same as bad credit, still it limits your ability to borrow money. The best way to fix it is to build up a good credit history by being a responsible borrower. You can also request for a copy of your credit report to see if there are information gaps that you can fill in.

Even if there are no signs of bad borrowing habits, lenders want to see enough information in your credit report that would convince them that you are a reliable borrower. So, even if you have substantial cash in the bank and a large equity in your properties, you may still have a poor credit with a thin credit history.

Bad credit: Inability to pay debts on time

If you failed to keep up with your credit agreements, you may weaken your ability to get approved for new ones. In fact, not paying past credit obligations on time, having your account sent to collection agencies, filing for bankruptcy and car repossession are negative information that can taint your credit report. When these negative entries happen within a short period of time-you may eventually have a bad credit.


Your application for credit cards, loans, rentals and utilities may be denied because of bad credit. If you do get approved, you may have to pay an interest rate which is higher than your counterparts with good credit. It is because lenders charge high interest to compensate for the risk of lending money to a high-risk borrower.

You can start improving your credit score by removing negative information from your credit report. Start adding positive information such as getting new credit accounts and paying them on time.

Credit builders

If you have a poor credit report, despite the fact that you are quite loaded, you can start getting credit building cards or loans.

Start with a short-term loan and pay it off on time. Eventually, lenders are more likely to accept your credit applications despite having zero to limited credit history. However, as a consequence of being made available to high-risk borrowers, you may have to pay an interest rate which is higher than the regular loan. But, you can negotiate with the lender by showing your assets, and opting for a secured loan. Overtime, lenders would trust you more when they see that you have been borrowing responsibly and you were able to successfully build your credit history in a short period of time.

Contact ALC Commercial to discover loan options that can help poor credit borrowers get the right funding suited to their financial goals. Call us on 1300 886 996 or enquire here today.