Tag: credit score

Mind the Gap: Making Credit Fair for Everyone

Currently, there’s been a lot of attention on fighting inequality & boosting fairness in the workplace. From the #MeToo movement to gender pay gap, we have a lot of challenges to tackle. But there’s another inequality that needs to be addressed too. The accessibility of fair credit for all.

Credit Explained

There’s no doubting that the world of credit ratings is rife with misconstrued information and misunderstanding. So, let’s understand how credit scores work.

Credit scores are used by lenders to decide whether to offer you credit (such as a credit card or a loan) and what the terms of the offer will be. The higher your score, the better your chances at receiving credit, and the lower rate of interest you will be offered. However, there are many factors that can affect your credit score, such as:

  • Payment history, i.e. late payments
  • Type, number and age of credit accounts
  • Total debt
  • Public records, i.e. bankruptcy, tax liens or civil judgements
  • Length of credit history

Differing Rates

As a result, within the UK, credit scores differ massively across demographic and geographic sectors. By analysing more than 5 million customers over the past year, ClearScore generated a list of areas with the highest and lowest average credit scores– with postcodes in the South of England with higher credit scores than those in the North. The worst area for credit is Sunderland, with residents holding an average credit score of 318.31 – almost 20% lower than the UK’s average score of 380.

Why is there so much disparity? Surely, if we as a country are striving towards fairness, everyone – no matter their location or background – should be entitled to fair, affordable credit.

Well, the current system dictates that those with low credit ratings have limited to no access to reasonably priced credit, which instils inequalities and drives people into even more debt (through credit cards, overdraft accounts or the likes of payday lenders who charge exorbitant interest rates).

Offering a Solution for Employers

We are trying to solve the challenge of rising debt and lack of savings by partnering with employers, to offer employees fair access to financial products. We partner with not-for-profit Credit Unions who are member-owned and are the ethical solution to providing credit & savings accounts.

Get in touch to learn more about how we can benefit your team today!

Spotted: Shocking increases in CCJ

County court judgements (CCJs) are at a record high, according to consumer debt figures for the first few months (Q1) of 2017.

CCJs are registered in England, Wales and Northern Ireland when someone can’t pay a debt they owe. It is a long road from taking out credit to getting a CCJ; lenders – usually banks, credit cards, store card companies – need to go through a collections route first. Only when the debt is still outstanding can they apply for a CCJ, which makes it harder for customers to get credit or a mortgage in the future.

Data from The Registry Trust – which records judgements on behalf of the Ministry of Justice – shows that 912,389 CCJs were registered in 2016. In contrast, only 734,205 were registered in 2015 – a shocking 24% increase in one year. The situation consumers are facing is getting worse.

In Q1 2017, there were 298,901 debt judgements, a 35% increase on the same period in 2016. That is nearly one-third of the 2016 total and the highest rise in CCJs over a three month period in over a decade. The average value of CCJs is decreasing, down to £1,495 per person, from £3,662 in 2008, a sign that lenders are getting more aggressive at chasing down outstanding debts.

Worrying Patterns

The total value of CCJ debt was £1.7 billion in 2016, with another £462.5 million registered in Q1 2017. Anyone watching the economy should recognise this as a worrying sign.

Registry Trust sees this as an aggressive move by lenders to attempt to collect arrears sooner rather than later. CEO of Creditfix, Pearse Flynn said that “Any rise in the number of County Court Judgements (CCJ) being registered against consumers should be cause for concern – but one as large as 35 per cent in the space of a year, and nearly 50 per cent in two years, could point towards a more aggressive shift in the way that creditors are chasing outstanding debt.”

For the last four years, CCJs have been on the rise. As a pattern, this shows us that lenders are lending more, but not everyone they consider creditworthy can truly afford the extra credit – or when their circumstances change, and they get into difficulty, they are eager to slap them with a CCJ. In turn, consumers tagged with bad credit get charged higher interest rates or get stuck in a cycle of repaying old debt for years, even decades.

The system is stacked against those who would benefit from extra financial health. No one should be penalised for mistakes or choices from years ago when current salaries make debt consolidation and a little extra help easily affordable.

A Fairer System?

Banks, credit cards, payday lenders and consumer finance partners aren’t the only ones that can lend money in the UK. Not-for-profit, member run Credit Unions can make responsible lending decisions, with previous blots on their credit file, but good recent financial health. When a loan is verified through an employer – which is the case when you apply through FairQuid – they can take other things into consideration, such as salary and how long you’ve been employed.

FairQuid loans are more affordable. Loan payments come directly from your salary, which means they take the affordability of this into consideration too. Loans through credit unions also automatically include a savings account, which means, over time, your financial health keeps getting better.

Don’t let your debt get the better of you: Now is the time to take control of your finances, with FairQuid: Your Money, Your Way. Find out more and apply here.

Sources:

1. http://www.credit-connect.co.uk/consumer-news/ccj-numbers-rise-highest-level-decade/
2. https://www.theguardian.com/money/2017/feb/06/sharp-rise-in-county-court-judgments-against-consumers
3. https://www.moneyadviceservice.org.uk/en/articles/dealing-with-county-court-judgements-ccjs

Your Money, Your Way

Wouldn’t it be great if you could apply for a loan without worrying that one mistake or debt from years ago is going to prevent you getting some extra money?

Banks and the majority of finance companies only make decisions based on your credit score. This magic number – which not enough people know, or want to know – is the only number that matters to most financial companies. We don’t think that’s right or fair.

A system where the deck is always stacked against you

Credit scores prevent too many people from accessing finance that they are perfectly able to manage and afford. In the building where we are based, there’s an entrepreneur – let’s call him Dave – running a successful company, with investors, paying customers and staff. But Dave can’t get a loan. He pays himself a decent salary – not a huge amount, but enough to live in London, and all he wants is a small loan to consolidate some debts and buy some new furniture.

Unfortunately, when Dave was a student, he got a credit card. Then another, then another. Five in total. Most students have more than one card and overdraft. Being a student is expensive, and banks advertise at them aggressively to take out as much credit as possible. Banks love students. They spend as much as they can, but rarely pay off a card or overdraft in full so that they can make money off them for years afterwards.

He was bombarded with free offers, and the credit cards were ridiculously easy to get. He did keep up all the repayments, except for one card – unfortunately forgotten in a move to London. It had a small unpaid balance – only £50.00.

It took a while for the demand letters to catch up with Dave. Once they did, he paid the balance, including the arrears, but the damage was done. The unpaid card left a black mark on his credit file for six years, making it impossible for him to access low rates in the meantime. His issue wasn’t the debt; it was that he never would have signed up for so many student cards if it wasn’t for aggressive targeting, easy applications and free offers. As a young student, he wasn’t mature enough to realise the long-term impact of these offers.

Banks stack the deck against those who need access to finance the most and credit scores are one of the main ways they screw people over.

A fairer system, with Credit Unions

Credit unions need to make responsible financial decisions, which means they need to factor in the results of a credit check. However, this isn’t the only way they judge loan applicants.

When you apply through FairQuid, they take your employment history and salary into consideration, alongside affordability. One black mark on your score from years ago isn’t going to prevent you getting a loan. Employment history – such as whether you’ve been with your current employer for a year or more. This shows positive financial behaviour, stability and your ability to earn a living. People, not algorithms decide if you can get these loans.

Loan payments come directly from your salary, which means they take the affordability of this into consideration too. No responsible lender should ever provide credit you can’t afford. Loans through credit unions also automatically include a savings account, which means, over time, your financial health keeps getting better.

Now is the time to take control of your finances, with FairQuid: Your Money, Your Way.

Find out more and apply here.

Broken Heart, Broken Credit: Making Sense of Credit Scores

Loans, store cards, credit cards and mobile phone contracts seem like a great idea when you are in a happy relationship.

But when things go wrong, which can happen at any age, monthly payments can turn into hazardous liabilities that can trip you up years later. Taking out credit – which includes phone contracts – for someone else is always risky, even when you are married.

Even if someone else is giving you the money to cover the payments, the debt is still yours. You are legally responsible. One such example is a guy who used his good credit score to get a phone for his girlfriend at university. Let’s call him Andrew. He took out a 12-month contract for her, but six months later, they broke up, and both of them moved to different flats.

A Series of Unfortunate Events

All of the bills were going to their former address. He didn’t change the billing address, and she stopped paying him. He wrongly assumed she would take over payments – which anyone can do, even without access to the account or needing to pass security questions. Maybe she did for a while, but at some point, she stopped paying, and he wasn’t paying anymore.

It took another six months for the debt to catch up with Andrew. When it did, it was over £150, including late payment charges and collection agency fees. He paid it and assumed the situation was dealt with. It was hard enough breaking up with his girlfriend, never mind the added pain of paying off her phone contract.

He was wrong to assume the debt situation was over.

Six years later, after climbing his career ladder, promotions and stable employment, Andrew’s credit has finally recovered. It has taken six years of being careful with money and not being able to get much credit for the one ‘black mark’ to stop affecting his ability to get loans, credit cards, store cards and a mortgage.

Making Sense of Credit Scores

Andrew is not alone. Millions of people – for one reason or another – have limited access to credit as a result of bad scores preventing us from accessing finance many of us can, on current salaries, easily afford.

For many people, credit scores are like a black box. Black boxes constantly record numerous data inputs on planes. In the same way, credit reports record data from numerous sources: our bank accounts, credit cards, phone companies, utility companies, store cards, mortgages, and any applications to apply for more credit.

Most of us don’t know our credit scores. However, you can find out easily enough – using ClearScore (free), Experian (free trial – but remember to cancel) and other free tools. But if you don’t know, yet want to apply for something, such as a loan or credit card, you run the risk of damaging your credit further thanks to marketing from banks and other companies that suggest you will be successful.

Aggressive tactics and offer target those most vulnerable, and more likely to need credit quickly. When people are denied, it can be tempting to try payday lenders, and others that offer money at an extortionate rate. When your credit has been damaged, but you are rebuilding, and in steady employment, payday lenders should not be your only option.

There is an alternative solution, thanks to FairQuid: Your Wages Your Way. If you’ve been employed for at least one year at your current employer, you can apply for a loan through credit unions that take employment history and salary into consideration.

We don’t base everything on credit scores. You also get an automatic saving account as part of this loan: starting from a minimum of £10 per month, with payments for both coming directly from your salary, making budgeting easier. All your employer needs to do is verify your employment and adjust your payroll if you are approved. It doesn’t cost them a penny. Find out more and apply here.

Your Wages Your Way

Worrying about money is a horrible feeling. It stops people sleeping at night. It grips you in the pit of your stomach. Money worries can get in the way of even the brightest summer day.

No one wants to worry about money, but even those who earn decent money – or at least have a stable job – can find themselves in a tricky position. In the UK, average household debt is around £13,000, and around 70% of us have no savings.

So it doesn’t take much to unsettle most people finances: A boiler breaking, car fails an MOT, an expensive month with too many Birthday’s, not to mention, for families, Christmas and the Summer Holidays.

The problem is, banks aren’t always willing to lend extra money when someone is in a tight spot. Banks assess whether they can lend based on credit scores. When applying for a loan, overdraft extension or credit card, it doesn’t really matter what you say. That is one reason you can apply online without speaking to anyone these days – people don’t decide who gets money anymore, algorithms and credit files do.

If you have a good credit rating, then getting access to a little extra money – or having that money (or credit) already available shouldn’t be an issue; but we know this isn’t always the case. Not everyone has an ‘excellent’ credit score.

Millions of people are stuck in ‘persistent debt’, paying off old credit cards, loans and overdrafts. And then there are others, whose credit files are still affected by acts of kindness that get turned into bad debts, such as when people get phones or loans out for other people who then don’t pay, or move away.

Bad credit scores still penalises people who have steady jobs and salaries that cover all their costs, except for unexpected bills and other expenses. You shouldn’t have to turn to payday lenders to rescue you from a tight spot.

There is another way. For anyone who’s been employed at least one year with their current employer, you can – through credit unions – get a loan that should pay off any current debts and help you start to build up some savings.

All you need is your employer to verify your employment. If you are accepted for the loan (which comes with an automatic savings account – starting from a minimum of £10 per month). People, not algorithms decide if you can get these loans. Loan and savings payment come straight from your salary every month, just like Ride to Work schemes, travel and childcare schemes and other salary deductibles (council tax).
…
All your employer needs to do is verify your employment and adjust your payroll if you are approved. It doesn’t cost them a penny. Find out more and apply here

FairQuid: Your Wages, Your Way.

Sick of Walking a Credit Card Tightrope?

More than 5 million British people have credit card debt that they won’t clear in full for ten years. Some consumers are paying £2.50 for every £1.00 borrowed, which is concerning enough that the Financial Conduct Authority (FCA) is going to make banks take action.

Credit cards are everywhere. In the UK, we are top of global league tables for credit card ownership, according to Kantar Media TGI research, with 73% of the population owning at least one credit card. Sixty percent of people pay the balance in full every month, with average credit card users only accessing 7% of the available funds. Some even play one card off against another, making more money than they pay in charges.

However, not everyone has the funds or ready access to credit facilities to juggle cards and pay balances every month. But that hasn’t stopped credit card companies targeting people – even those who can’t afford it – with offers to transfer a balance to a card with 0% interest.

With average household debt around £13,000, we have to wonder if the financial sector is once again following a dangerous and irresponsible path? What about consumers: Are people aware that alternative options exist?

Making Sense of 0% Balance Transfer Offers

Credit cards are useful when they can be paid off quickly, or when you are only using them for small purchases. But for the 3.3 million people paying more in interest than the outstanding balance, banks are earning a considerable profit from those customers. Hence FCA concern; although, action to help them may not come into force until 2018.

We need to remember that banks can’t stop people from spending. All they can do is offer advice, guidance and ensure customers understand their options. It could be said that many are failing in this area, especially when offering someone a 0% credit card balance transfer.

Offering a customer a new credit card, with a long zero-interest rate period (up to 40 months, or more) sounds like a great deal. Transfer fees are often 3.9% or less, with some free or only 1%, which is usually far less than one month’s worth of interest.

Providing someone can afford to pay the debt in full they are getting a bargain, but for many who can’t afford this, they are effectively being tricked into prolonging their debt cycle. Applicants should check they can afford the deal first, with affordability calculators on most comparison websites. Credit score tools, such as ClearScore, will also show whether you are eligible for an offer, which is worth checking, since once a credit check is done it leaves an imprint on your file, thereby reducing your score.

Not only that, but not everyone who is eligible gets a great deal. About half are offered a higher transfer fee with a shorter zero-percent interest timescale. Not everyone who gets these offers is eligible, which means applying leaves a negative impression on your credit file. The FCA has also found that 20% of people on zero-percent deal cards did not expect to pay interest on a new purchase. A classic bait and switch, with banks concealing information they ought to make clear to applicants.

A Better Alternative?

Transferring debt from one card to another is fraught with risks. Especially if you are worried about your credit score. Loans from banks are harder to get than credit cards. Thankfully there is an alternative. With FairQuid, you can take out an affordable loan and consolidate credit cards and any other debts.

We only work with ethical lenders and credit unions, and they use a broader set of criteria to assess a loan applicant, including your salary and number of years with your employer. Minimum eligibility means at least one year with your current employer.

Want a solution this year? Debts you want to consolidate? Or are you looking for an easy way to start saving?

FairQuid is here to help. Our loans have already made debts more affordable for hundreds of people across the UK who want to reduce their debts and start saving. Fill out the form on this page so you can ask your employer to offer this as a completely free benefit to all staff.

Why Credit Unions Are The Future of Employee Financial Wellbeing

Consumers lost confidence in mainstream banks as a result of the recession. Mortgage foreclosures, PPI, tighter lending criteria and rejected loan applications crippled millions of families and businesses when they most needed help.

At the same time, governments in the UK, US and Europe were bailing out banks to the tune of several hundred billion pounds. Financial executives were walking away with six and seven-figure golden parachutes when customers were having homes repossessed. It wasn’t a good time to be in the financial services sector, and even now, we are living with the repercussions of that economic collapse. Media stories of massive RBS losses still stir up old resentments.

Banks have more competition. Customers expect more from financial providers; they expect them to make smarter, more ethical, choices. Credit Unions, now numbering 500 across the country, with over 1.6 million members, are a group of competitors that have benefited from a public unwilling to put all of their money and trust back into banks. Credit unions are more popular in other countries, with over 40% of US consumers a member of a credit union. In the UK, that figure is around 4%.

Most credit unions are considerably smaller than banks. It makes it difficult for them to make potential members aware of them. Employers could step in with a solution that helps staff and reduces stress-related absence and staff turnover, with support from credit unions.

How Credit Unions Can Solve Absence & Turnover Problems

Debt and unexpected bills reduce employee performance. Stress increases staff absence, even turnover when they are worried enough about money to look for another job.

With average household debt around £13,000, we can’t assume that banks will lend more money if an employee wants to consolidate debts, or they have an unexpected bill, and we can’t even assume that those on higher salaries save money since savings rates are so low in the UK. In case of an emergency, people are as likely to turn to payday lenders and credit cards than savings.

Credit unions have a better solution, which employers can help their staff find, through employee-benefit loans and savings accounts. Here are a few reasons why credit unions can provide an advantage for employer’s looking to reduce stress, absence and turnover amongst staff, whilst also improving long-term financial wellbeing.

1. Loans based on years in service

Credit union members can only get loans when they have been a member for a certain amount of time. When it comes to employee-benefit loans through FairQuid, credit unions need a minimum of one year’s service with an employer. This way, you can reward service with the option of loans and savings accounts from an ethical financial provider they would not normally be able to access straight away.

2. Salary and employment history influence the loan amount

Mainstream lenders don’t take this as much into consideration as credit unions that offer employee-benefit loans. The longer you work for a company, and the more you earn, the more you can borrow; generally up to £7,500.

Banks put far more weight on credit scores, which means any bad history will increase your interest rates or make an employee ineligible for a loan, even if they can afford it. That doesn’t help people who want to consolidate debts or pay for an unexpected bill, which in turn means they could take time off due to stress, suffer low productivity (financial stress can cause your IQ to drop 13 points) or start looking for another job. Consequently, productivity suffers, all as a result of something outside your immediate control.

3. Manageable affordability and savings

Anyone who gets a loan from a credit union becomes a member, which means they also need to start saving – as a result of automatic enrolment in the Membership. Since both the loan and saving amount are taken at source – the same as Tax & NI – the employee doesn’t see the money come into their account and then have to pay it out.

In effect, they don’t miss what they don’t have. This way, they adjust to the slightly lower Net salary, whilst knowing that a rainy day fund is building up and their debts are decreasing.

4. Hassle free loan applications

Employee-benefit loans also make applying for a loan far easier, since the bulk of the paperwork they need is verified through the employer. Credit unions can process applications faster. Staff who are stressing about money can have a solution that eliminates these worries quickly so that everyone can get back to work.

Need a solution that makes a real difference to your staff, without costing your organisation a penny? Debt is everywhere, but it doesn’t have to drag down your productivity. Our employee benefit loans and savings accounts, provided by ethical credit unions, are the answer. Find out more:

Lending Money to Staff: Pros and Cons?

We aren’t born worrying about money, as Yorkshire Bank likes to remind anyone who uses their cash machines.

And yet, for the majority of adults in the UK, money worries cloud our waking thoughts – and troubled nights sleep – more than we realise. Old debts, credit cards, overdrafts, store cards, consumer credit purchases – such as cars and sofas – can make it difficult to save for a rainy day, for a holiday, or for buying a house. Most of us work to live, making money a recurring source of worry.

It is worse when you are in debt, which most households are, to the tune of £12,887, according to recent figures from the Office for National Statistics (ONS), on average, which includes student loans. Mortgages aren’t included in that figure.

Sudden unexpected costs can throw a household budget into turmoil. From new tires to a broken boiler (1 in 5 break every year), we can’t always control how we spend our money. It would be great if we could, but life can get in the way.

When people don’t have a rainy day fund – which is easier said than done – it can force them into a limited range of options, especially if poor credit scores and other lines of credit prevent them from borrowing more from banks and building societies. Under these circumstances, some will turn to an employer, especially if there is a history of lending money to staff in need.

Should You Lend Money to Staff?

There are a few different ways companies lend money to staff. In London, interest-free annual TfL travel passes are a great way for employees to save money on tubes, trains and buses, with the payments deducted monthly from salaries. For this article, we are talking about when an employer transfers money to an employee as a loan.

Although there are risks, there are a couple of benefits to lending money to employees.

Loans encourage loyalty. Unlike loans from banks, credit unions, or even payday lenders, this money is directly tied to an employer; therefore, an employee is more likely to feel a stronger sense of loyalty to the company. Taking money worries off their mind means they can focus on work, which in turn means they will be more productive, thereby creating more value for your company.

However, there are downsides, which businesses should consider before lending money.

#1: Potential Consumer Credit Implications

Loans to employees can become voidable if there is no 14 day cooling off period given, no annual statement of accounts, and if there are any restrictions on how the funds are used.

The Consumer Credit Act casts a wider net than many employers probably realise, with fines of up to £5,000 and, potentially, two years in prison, if a company is caught issuing consumer credit without a license. Without realising it, companies that lend money to staff could be in breach of the Act.

#2: Discrimination Concerns

From a financial perspective, some employees are a lower risk than others. Unfortunately, lending to one and not the other can cause tension, bad feelings, and potentially, charges of discrimination being levelled against a company.

#3: Loans as a Source of Stress, Financial Dependence

Loans aren’t always a one-off. When the same staff are coming back for loans, emergency advances and quick cash injections, it raises the question as to whether you are doing more harm than good. Clearly, in these cases, they have become financially dependent on the extra money and are living beyond their means.

In the long-term, this is an unhealthy cycle that needs to be broken. Plus, this places an undue financial strain on a business when it is constantly acting as a credit line to employees. There is an alternative solution: Employee benefit loans, combined with a saving account.

Give employees the option of taking a loan connected to their employment – contingent on years of service and performance – with repayments funded directly from their salaries. Credit ratings are still important, but finally, there is a way to ensure past financial performance isn’t the only criteria to judge future stability.

Employee benefit loans take the strain and financial risk off employers, whilst providing staff with a way to consolidate debts and start putting money aside in that rainy day fund. Now that is an employee benefit your staff can take to the bank. Find out more today.

Sources:

> http://www.macfarlanes.com/media/1731/loans-to-employees-consumer-credit-act-implications-ric-march-12.pdf
> http://www.hrpayrollsystems.net/are-employee-loans-a-good-idea/
> http://www.personneltoday.com/hr/how-to-offer-loans-to-employees/

Credit Scores: does the past predict the future?

Credit scores were designed to measure the risk of default by taking into account various factors in a person’s financial history. These factors can be grouped into the following categories below (the percentages are the weights contributing to the FICO score*, the predominant credit score in the US). The credit reference agencies in the UK also follow a very similar model of scoring.
• payment history (35%)
• debt burden (30%)
• length of credit history (5%)
• types of credit used in the past (10%)
• recent searches for credit (10%)
• other, e.g. recently opened account, credit cards, etc. (10%)
*source: Wikipedia

Does the Past predict the Future?
The underlying popular maxim that the financial world seems to be going by is “The best predictor of future behaviour is… past behaviour”. The problem with this approach is that, a large majority of folks (non prime as they would be referred to) find themselves in a classic chicken and egg situation with seemingly no way out.

You will get credit or get credit at a reasonable rate of interest when your credit score improves. But how does one improve their credit scores if it is based on events that have happened in the past? One is supposed to build credit scores by taking out new credit and building a pattern of timely and full repayments. But with low credit scores most of the credit available for this purpose is at a very high rate of interest that is not sustainable for them….Hence the chicken and egg cycle continue worsening their scores further.

Employment as indicator of good credit.
While credit bureaus are trying to perfectly measure the credit worthiness by only looking at the historical payment patterns of an individual, they miss out on adding any variables that can help predict future behaviour independent of the past mistakes. There seems to be no second chances in the institutional finance world. FairQuid believes that there are a few important underlying factors, like employment history, income and expense pattern analysis beyond the standard ratios and job performance of the applicants (HR data around performance ratings and appraisal/promotion frequency). These additional employment factors explain someone’s ability to repay a loan in a timely manner and their overall future financial strength potential much better.

While steadily building up an intoxicated credit file during the crises times, a large segment of the society falls prey to payday lenders who are leveraging on the psychology by keeping the borrowers in their debt circle. The so called “lender sharks” are lending small ticket cash to survive until the next week and charging sky-high interests for this “weekend” cash.

All credit bureau scoring systems rely on previous credit histories and changes in personal details such as address of the borrower. How would they capture the risk to lending someone who just got employed in a new town, changed their address and want deliberately to come out of their financial debt circle? Or being trapped in an expensive debt spiral during the times of uncertainty, unemployment and personal crises like divorce?

FairQuid’s mission.
FairQuid’s mission is to challenge the toxic lending practices and make credit available for employees, by making their hard work and job performance count for them. The size of the income is only one aspect of the character of the employees, other qualitative measures such as length of service at the current employer, recent promotion and a bonus at the end of the year would also be a strong indicator about someone’s financial credibility.