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Everybody knows that having bad credit means you probably can't get a home loan. That's obvious! But there's more, and it may shock you just how bad off you may be.
There are several dozen ways a bad credit score can virtually destroy you, and yet most people are oblivious to them.
But in this article, They Are Revealed.
If you haven't taken this topic seriously before, NOW is truly the time to discover these 9 scary ways your bad credit can haunt you. Furthermore, these 9 reasons are the best incentive for you to start fixing your credit today, without another wasted second. You won't find better motivation.
Bad credit hurts you worst in the following areas:
? Car insurance
? Car loans
? Employment
? Housing
? Utilities
? Cell phones
? Elective medical procedures
? School loans
? Marriage
1- People with bad credit will pay anywhere from 2050% more for auto insurance than if it were good. This is because many insurance companies now are basing your insurance premiums on your credit scores. Insurance companies call it 'profiling.'
This is costing you $50-$100 per month, which could be going toward productive expenses like your retirement, or a kid's college fund.
Ouch! That stings a little. But keep reading' We're just getting started.
2- Some car dealers now give different mark-ups to people with bad credit.
Specifically, Honda Finance Corporation will charge a 3.5% markup to consumers with bad credit. General Motors Acceptance Corporation and Ford Motor Credit Corporation take a similar approach.
In other words, if you were buying a $30,000 Honda and you have bad credit, you will pay an EXTRA $1,050.
The math is simple. Basically it means more money out the window every time you need a car. (New or Used.)
3- 70% of employers are now checking credit ratings.
From their point of view, they are afraid you will have more family problems, creditors will be calling you at work, or that they may have to garnish your wages, if your credit looks bad.
Bottom line is they just don't want to deal with the hassle. Their choice is obvious. They simply give the job to someone else.
How much does that cost you? Can you even put a number on that? YIKES!
4- Landlords want to rent to someone they feel confident will always pay the rent. A recent survey tells us that only 48% of renters know that a rental property owner may reject tenants based on poor credit scores.
How would you like to be homeless? Or, almost just as bad is being stuck with a dumpy house on the wrong side of the tracks, all because of your poor credit?
5- The same survey tells us that only 30% of people know that a low credit score could likely cost you an extra $500 in the form of a security deposit when getting signed up for utilities.
Utility companies are now pulling credit scores to determine who pays a deposit and who doesn't.
This conversation keeps getting more expensive by the minute, doesn't it?
6- Even cell phone providers are looking at your credit score now and if it's not high enough guess who's paying a higher rate for 'pay-as-you-go' service?
You guessed it; the same person who's paying more for their car, house, utilities, and who can't get a decent job.
But that's not all' I'm not done yet.
7- Doctors will NOT perform elective procedures on a payment plan such as laser eye surgery, dental procedures, cosmetic surgery, and more, for individuals with poor credit scores. They will only accept cash paid up front.
8- School lenders are now denying student loans to students with low credit scores.
Imagine this'If you have bad credit and your one semester away from getting your degree, you can easily be left high and dry without hope of financing or finishing your degree.
It's not a matter of paying the higher interest rate. You just won't get the loan. Fair or not, that's how it is.
If you were the student who couldn't get a loan to finish your schooling, you will obviously have difficulty getting a decent paying job. Furthermore, you will be thrust right into that 'hiring cycle' described in the first point of this article. Whereby an employer may look at their credit score to help make their hiring decision AND on top of that you don't even have the needed credential because you had to cut your schooling short.
So what do you do? Perhaps you could use your spouse's credit to help you get a loan.
9- That might work if your spouse has good credit but did I mention the number one cause for divorce in America is money problems? Just ask Dr. Phil.
Let's look at the situation'. You pay an extra $50 a month for car insurance, an extra $50 per month for your car, you can't get a student loan to finish school nor will anyone hire you, and you spent your last $500 paying for a security deposit to the utilities. By now you can't even afford to prepay your pay-as-you-go cell phone, and the bills you do have are too high, because of this whole 'bad credit' garbage.
You couldn't get a home loan if you tried but fortunately you could get a rental. Although, it isn't on the good side of town, if you know what I mean.
We don't even need to mention the wish list you have for your health and wellness (dental, vision, cosmetic, surgery, etc). I mean forget about that stuff. You are in survival mode here.
Is your spouse happy about this situation? It usually causes a little friction'' to say the very least. Most couples in America call it STRESS and FIGHTING.
We call this the downward spiral.
And the worst part of this whole conversation is that I could actually keep going with another dozen (or more) VERY significant and UGLY reasons to avoid bad credit. Including interest rates, home loans (or lack there of), retirement issues, promotions, friends/relationships, credit cards, investing, and more.
The point is PROTECT YOUR CREDIT and if you already have bad credit, get help and fix it now. This may require several months or even a few years of dedicated work and sacrifice. But rest assured, it will be worth it.
Search out professionals to guide you through the repair process. Stay focused and dedicated. It is not hopeless.
Break the cycle now and get yourself on the road to financial freedom. |
| Author: Dan Ostler |
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Author Bio:
Bio - Dan Ostler is the owner of www.LeaseOptionHomeBuying.com. Dan is an author, speaker, business owner, investor, and one of the nations leading Lease Option Consultants. He has been offering housing solutions and consulting advice to families with credit issues in all parts of the country for the past 8 years, and welcomes all visitors to his website for tons of **FREE** Information. |
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