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One of the most significant investments people make is purchasing a home. Lenders scrutinize credit scores and history before offering a mortgage. A poor credit score can lead to higher interest rates or outright denial.
Landlords and property management companies often check credit scores of potential tenants. A poor score can result in declined applications, higher security deposits, or the need for a co-signer.
For many, owning a car is essential for work or daily life. Auto lenders look at credit scores to determine interest rates and whether they'll approve the loan at all.
EG: Military advancement. Some employers, especially in financial sectors or those requiring security clearances, may conduct credit checks as part of their hiring process. A poor credit score might be seen as a sign of financial irresponsibility and could impact hiring decisions.
Entrepreneurs seeking business loans or lines of credit will find that their personal credit scores often play a role in a lender's decision, especially for new businesses without a proven track record.
Credit cards are not just for spending; they're tools for building credit, earning rewards, and managing cash flow. With poor credit, one might be limited to secured cards with lower limits and fewer benefits. In all these situations, having at least passable credit can make the difference between reaching one's goals and facing significant obstacles.
Credit can significantly impact a single parent's financial situation with high-interest rates, difficulty getting approved for loans, difficulty renting, higher insurance premiums, difficulty getting a job, limited emergency funds debt cycle. Dealing with poor credit and the associated financial difficulties can lead to significant stress and anxiety, impacting a single parent's well-being and ability to care for their children.
Events like marriage or divorce can significantly impact credit and financial well-being. In marriage, joint accounts or shared debts can negatively affect both individuals' credit scores if one partner mismanages finances. In a divorce, the division of assets and debts can be impactful. Life-changing events can be emotionally stressful, impacting your ability to make sound financial decisions, leading to impulsive spending, missed payments, or neglecting financial responsibilities.
Achieving greater economic success is hard, especially when you have poor credit.
Being faced with a low score and personally going through challenges in your life makes it seem impossible. But you are determined to find sustainable solutions and make a change in your life.