5 Little Known Ways Bad Credit Can Affect Your Life
Nobody sets out to damage their credit, however, many people find themselves in this situation for one reason or another.
While it may not sound like a big deal, there are many ways bad credit can affect your life. For example, you may find it more difficult to secure a car loan or mortgage. Subsequently, you have to adjust your approach, hoping to find a lender that is willing to do business with you.
Fortunately, bad credit car loans are available. With this type of loan, your credit score is not expected to be above average. Instead, the lender is well aware that you have bad credit and is still willing to provide financing.
It is common knowledge that bad credit can hinder the ability to secure a loan. But did you know this can impact your life in many other ways?
Being Denied a Job
Many people don’t think twice about their credit rating when applying for a job. They are under the impression that this has nothing to do with whether or not they are hired. While this may be true with some positions, there are times when this detail is taken into consideration.
If you are applying for a job in the financial industry, there is a good chance the employer will pull your credit report, with your permission, during the hiring process. Here is why: if you don’t know how to handle your own money and finances, the company may feel you don’t have what it takes to do so on their behalf.
Note: you are not required to grant the company permission to pull your credit report. If you deny them the ability to do so, it will raise a red flag and could potentially cost you the job. You are better off letting the company see your credit, and then doing your best to explain what happened in the past and what you are currently doing to make things better.
Higher Insurance Premiums
Like most, you understand the importance of purchasing insurance. From your car to your home, protecting your most valuable assets is something you should never take lightly.
Unfortunately, the cost of insurance is on the rise. More people than ever have come to realize that they are unable to comfortably afford their insurance premium.
If you have bad credit, you are likely paying more for insurance than those with good credit.
Insurance companies often feel that people with lower credit are higher risk. As a result, they increase their premium to hedge against the perceived risk. Is this fair? Probably not. But it is a practice that most insurance companies undertake, which can have a big impact on your finances.
Tip: if you are concerned you are paying too much for insurance as a result of poor credit, contact your insurance company to learn more. Don’t be shy about asking them if your credit rating has any impact on your premium. Furthermore, discuss how your premium will adjust as your score improves.
Paying Security Deposits for Utilities
Are you moving into a new home? Are you renting an apartment? When it comes time to turn on utilities, you hope the process is as simple as contacting the appropriate provider and discussing your options.
If you have bad credit, don’t be surprised if you are asked to pay a security deposit. Due to your past troubles, the utility provider does not trust that you will pay your bill in full and on time. Even more so, they think there is a chance you could “leave them hanging” with a large bill. This is why they request a security deposit before activating your account and service. This way, if you don’t pay your bill, they aren’t out any money.
Tip: if you are required to pay a security deposit, discuss what will happen to the money in the future. You should receive a credit if your account is current when you terminate service.
Difficulty Renting a Property
Everybody needs a place to live. If you have bad credit, it can be hard to find a landlord that is willing to let you move in.
Fortunately, most are willing to work with you, as long as you have the ability to pay a higher security deposit. Just the same as your utility providers, this gives the landlord peace of mind in knowing they can keep this money if you neglect to pay.
As another form of protection, some landlords will request that you pay multiple months of rent in advance.
Obtaining a Cell Phone
In today’s day and age, there aren’t too many people who go through life without a cell phone. In fact, a growing number of people are relying solely on a cell phone, forgoing a home phone altogether.
Wireless providers can make life difficult on you if your credit is less than stellar. Upon applying for service, they may require a large upfront payment. While not common, there is also the chance you could be denied for service altogether.
Don’t Let Bad Credit Get You Down
Now that you are familiar with some of the little known ways bad credit can affect your life, you have one of two options:
Continue to deal with all the stress this brings to your life.
Look for ways around the system, ensuring that you aren’t held back by your past financial mistakes.
We provide bad credit car loans to those who are unable to secure a loan from other dealers. Over the years, we have helped hundreds of people with bad credit purchase a vehicle that suits their lifestyle and budget.
It may not be easy to get by with bad credit, but it is anything but impossible. If you have bad credit and are in the market for a vehicle, contact our business department to learn more about your options.