Having a bad credit history can be stressful in itself as you may still owe debtors or may be struggling to stay afloat underneath piles of bills. Beyond an undesirable credit record, your bad credit may end up hurting you in other ways. Here are five instances in which a bad credit record can come back to bite you.
5) Rental Application Rejected
Landlords more and more these days are doing background credit checks to judge the suitability of potential tenants. This means financial mistakes you made in the past can hurt your ability to find housing.
4) Problems Finding a Utility Provider
If you do find a place to move into that does not judge you on your bad credit history, a utility company might. Some electricity, cable and phone companies demand a credit check to ensure you can and will pay your bills on time. If you have a history of bad credit, they may make you put down a security deposit before they will sign you up.
3) Pay-As-You-Go May Become Your Only Option
“Who needs a house phone anyway”, you may think to yourself, “I’ll just get a cell phone”. Well unfortunately in order to get a contract with a cell phone carrier, (which tend to be the cheapest options for the best plans and phones), they will also require a credit check. Your other option is to accept the hassles with a pay-as-you-go option that you need to scramble to refill every time it runs out.
2) Higher Interest Rates
History of bad credit leads lendors to assume that you are a riskier candidate to lend money to, say through credit cards for example, therefore charging you higher interest rates. This is bad news for someone who has already struggled financially, ruined their credit and is trying to build good credit. Higher interest rates means more money to pay off which keeps you in a negative cycle of owing larger amounts of money back.
1) Car Loan Rejected
Car loans are hard to find approval for particularly if you have bad credit. However, there are companies out there that exist like Finance Today and Auto Loans Calgary that guarantee approval for anyone no matter what your credit history looks like. This is your best option for getting approved for a car loan and purchasing a car if your credit history doesn’t look so good.