Don’t Let Bad Credit Be Your Downfall

When it comes to credit issues, we all make mistakes of one kind or another. But many people have no scruples in such matters. At one point in time, bad credit was more of a reality for most of us. It’s because there were so many options available that we never really considered if a loan would do us good or pull us down even further, or if we would be able to pay for credit card purchases at all.

We have spent hours and hours agonizing over why this had to happen to us as opposed to someone else. In all honesty, there was a time when I owed so much that I had been making late payments or altogether missing payments. But the idea of bad credit hardly bothered me. In fact it was the farthest from my mind. I just wanted to finish paying off my debts, and never really thought about the disadvantages of becoming a high risk borrower.

I have found that a woefully large number of people have no idea about all that bad credit entails. To clear things up, bad credit usually stems from not being able to make timely payments, failing to pay, exceeding your credit card limit and filing for bankruptcy. An occasional late payment, however, is not going to result in your being labeled as a high risk candidate when it comes to loans.

But if they see a trend — which could be based on your payment history as well as the status of your other loans or debts — they will presume that you are unable to pay. You could do yourself a favor by consulting your creditors when a severe cash crunch starts threatening you. Lenders are not necessarily villains, and they would be willing to help you make the payments. Running away or hiding from debtors is usually the first sign that you are on the verge of having bad credit.

A bad credit score can mean bad news for the way in which you and your family live. If you have bad credit, chances are you will have a hard time applying and getting approval for a new loan or credit card. With a history of bad credit hounding you, the best bargains will automatically go elsewhere. The risk debtors take in lending you money will have to be shielded with higher interest rates. Believe it or not, bad credit also affects your employment chances, residential choices and sometimes even your insurance.

I have been there and I have seen the dark side, the humiliation of being turned down a job as well as having an apartment manager tell me that because of my bad credit history they won’t be able to accept me into the building. There is no need to be subjected to such an ordeal.

You can avoid falling into such a vicious cycle. All you need to do is keep a track of how you spend your money. It is just a matter of being able to manage your funds properly as well as looking for the right lending companies. It is not as easy as it sounds. A little persistence and a lot of effort makes the difference between a bad credit score and a good one.

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