Credit affects a number of aspects of our life; home loans, auto loans, and availability of extra funds, just to name a few. Here are 5 ways that poor credit can impact your life that you may not have thought about before.
- Access to Emergency Funds
Medical, home, pet, and auto emergencies happen, and they can come at the most unexpected times. Credit cards and emergency loans can help you make sure the expenses are covered, but a low credit score could keep you from obtaining either of these options.
- Damage Your Relationships
If you are unable to be approved for traditional lending, how will you be able to finance your large purchases? Turning to friends and family to borrow money, or cosign a loan is an option that quickly comes to mind. Late payments to creditors will hurt your credit profile, but being late on your promise to a friend could end your friendship.
Many landlords will check a prospective tenant’s credit profile before allowing them to rent. The eviction process can be very expensive for a landlord, so a potential tenant’s missed payments could leave them without a lease.
- Interest Rates
There are ways to obtain approval for a loan or credit card with bad credit, but they usually come with very high interest rates. High interest rates can add up quickly on a home or auto loan.
- Quality of Life
Debt can prevent you from getting an education, a better job, and fulfilling your potential. Bad credit will only further this problem by forcing you to put your goals aside when you can’t get what you need to succeed in life.
Don’t let your credit hold you back, make it work for you!
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