Bad credit has a dramatic effect on so many aspects of your life that many people don’t even realize how far and deep it reaches. One of the biggest affects bad credit has on your life is that it increases the costs of just about everything you are involved with.
Credit Cards – Do you see all those great commercials asking you “What’s in your Wallet?” These are credit card companies touting their latest and greatest “green, gold, blue, platinum, black,silver, gold, pearl, turquoise or other uniquely colored” credit cards with very low interest rates that have no annual fees, allows you to earn points and even forgive an occasional late payment. Well these cards are for the financial elite. If you apply for a credit card with credit issues and are lucky enough to be approved you can expect to pay interest rates somewhere in the high 20% rates, instead of earning points you will have to pay them an annual fee for the privilege of paying them huge late fees and/or over limit fees the second you are late. In a society where you can’t do anything without a credit card people with bad credit are forced to endure the huge expense of carrying these little plastic cards of death.
Auto Loans – With bad credit instead of qualifying for the newest super gas efficient hybrid car you are forced to settle for a 6 year old second, third, or fourth hand car with questionable history. For the privilege of driving this beater upper you are forced to give 10 personal references so if you are ever late they can call everyone on your friends list and harass them for your payment. You get to pay for frequent repairs and of course pay for much more gas than if you had that nice shiny new hybrid. You also have much less money in the bank because the lender wanted to hedge their bets and made you put down all of your savings as a down payment
Auto Insurance – As if paying through the nose for your new used car wasn’t enough your auto insurance company decides that they should charge you a higher rate as well, why? Well everyone else is doing it so why not!
Home Loans – If you are lucky enough to have enough expendable income after getting gouged on credit cards and your car to somehow qualify for a mortgage chances are you will be required to pay a larger down payment and an interest rate well above market rate which over the life of the loan will cost you 10’s of thousands of dollars in added interest payments alone.
Renting – For those of us not lucky enough to be able to finance a home we will have the opportunity to rent, unfortunately you won’t be able to choose where we rent from, that decision is up to the landlord. Chances are you will not live where you desire, maybe a little further away from work (more gas money) maybe in a rougher part of town (higher grocery bills) you may need a larger deposit and the landlord may ignore your credit if you ignore the conditions of the property.
Utilities – Now that you have a place to live chances are you will have to pay large deposits for all your utilities cutting directly into the little savings you have.
Cell Phones – You forgo the phone companies telephone line and decide to get a cell phone but here to you are stuck with a lousy prepaid service that doesn’t have the newest phones but still charges you an arm and a leg for last years models. All because you can’t qualify for the best services that offer the best phones, at least not without a huge deposit
Bank Accounts – Now that you are in your new place you realize you want to start paying your rent using a check since the cost of money orders have gone up recently, you apply for a bank account and you find out that because of your credit history you only qualify for a savings account and you can’t even get a debit card for that.
Employment – Now that you are paying more for your car, home, insurance, gas, and credit cards you start thinking that maybe you need a job that pays more, you go on a couple of interviews which you pretty much aced but then a few days later the company tells you that they went in another direction, they chose someone with the same qualifications except they had better credit. You plead your case but they can’t change their mind as it is just their policy. You are now stuck at your old job with your old income but now you are spending a lot more on the basics.
Business Start Ups – You get a bright idea and tell yourself that you are going to get out of the rat race, you have a great business idea that you know deep inside will take off and allow you and your family to finally enjoy the better things life has to offer, you go to the bank to get a small business loan for your new business that just can’t fail and behold they tell you that you just don’t have good enough credit, you should try next year.
Relationships – You go home to tell you wife/husband that the stupid bank said no, both your dreams are ruined and she/he just can’t take it anymore and wants a divorce. Over 50% of marriages end in divorce and most issues have to do with finances.
You can start fixing this problem today, don’t ignore your credit any longer, someway, somehow you must start thinking about how you will resolve these credit issues as they will not go away. Sure everyone says that in 7 years everything will be cleared but in the real world companies re-age debt all the time and the only way to fight it is with credit repair.
Credit repair can remove negative items from your credit report, as negative items are removed your scores go up, as your scores go up you face less financial issues. Learn to live life on the cheap again and consider what you will do for credit repair.