Time to Get Serious
Having poor credit is a burden in many ways. Mortgages, car loans, insurance policies and many other items will all carry higher rates. Higher expenses aren’t the only way a bad credit score can cost you. Even trying to rent can be more difficult, landlords usually look at a potential tenant’s credit score as part of the rental application process and many will decline renters with low credit scores without a thought. Attaining a credit card could also be a struggle, as there are fewer options for those with poor credit.
Here are three other less known ways that poor credit makes life more difficult – also some tips to help you out.
Signing up for utilities is more complicated.
For those with good credit, setting up utilities usually requires just a phone call, or a form filled out on line. But people with poor credit have to take extra steps. If your score is really awful, you may need to put down a deposit with each utility company to get your services turned on. For people that don't have enough money for the deposit, one option is to ask a friend or family member who will guarantee to pay your bill in the event you do not.
Getting a job or promotion is more difficult.
Potential employers can’t view your actual credit score, but they are allowed to request an employment credit report, which doesn't show your account numbers and personal information yet includes your payment history and loan information. In today’s employment market, a poor report could be a reason you could be rejected for a job or a promotion.
Romantic relationships can be complicated
Not even your romantic life may be safe from a bad credit score. Financially responsible consumers know the potential impact of a partner’s bad credit on their own finances. According to a 2014 'NerdWallet analysis', 53% of single adults over age 25 say they are “somewhat less likely” or “much less likely” to go out with someone with bad credit.
Here are a few ways to raise your credit score:
Pay your bills on time – no exceptions, no excuses. This is by far the most important thing to build and maintain good credit.
Avoid using more than 30% of available credit on your cards during the month, suggest many experts. Carefully monitor your balance throughout your billing cycle and make a payment if you start to get too close to that percentage.
Start using credit as soon as you can. The easiest way to do this is to get a credit card and use it responsibly and pay it off monthly.
Only apply for credit you actually need – too many 'hard inquiries' in the span of just a few months will ding your score.
Go to a safe credit checking site to obtain a copy of your three credit reports once per year. Review them, carefully, for accuracy; if you spot an error, definitely start the process of having it corrected as soon as you can.
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