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Have bad credit? There are things that you can’t do with bad credit. However, that should not limit you since there are ways that you can rebuild your credit score.
But today, let’s talk about the things you can’t do once nasty credit ticks in your Experian score.
But wait, what is bad credit?
The FICO score usually starts from 300 to 850, and lousy credit stands from 300 to 579. So once you have a score between 300 and 579, I will say that you have bad credit.
However, some lenders only prefer to lend those with good, very good, or excellent credit scores(670 to 850). They do not consider those with fair credit scores (580 to 669).
Now, what are the things you can’t do with a bad credit score?
You will not get cheap loans
Lenders tend to sell costly loans to individuals with bad credit scores. They know that you have fewer options and that you need them. They will then take advantage of your sorry state and give you online payday loans with high-interest rates.
For instance, payday loan lenders charge very high-interest rates to their borrowers. So they hide in an argument that they deal with high-risk clients. And indeed, the clients are a risky move to deal with them.
Some companies have passed rules that they are not giving jobs to people with bad credit. What a disappointment. The bad credit does not directly affect the employer, but they don’t want it with their employees anyway.
You can’t get a mortgage
A mortgage is usually a long-term loan that you take to finance your home purchase. Since the lenders are giving you lots of money, they want to be sure that the borrower doesn’t have some bad money history.
However, in mortgage loans, the house serves as collateral if you get stuck on the way of repaying your loan. But the lenders need to deal with straightforward individuals.
You cannot get a car loan as well
Similar to mortgages, the car serves as collateral in this kind of loan. But the lenders need you to have a clean credit history with no red alerts.
A car loan is a long-term loan, and the borrower needs to deal with a more responsible borrower. That’s why they might not consider you with your bad credit.
You will not have a good time in marriage
If you get into nasty credit scandals earlier before marrying, it might be harder to get a spouse. The other party may want a partner to get a home together so that it might be challenging at some point with your bad credit.
You might not get co-signers
If you need a loan with bad credit, you might need to get a co-signer. And it might be hard to get one. However, remember, if someone accepts to sign on your behalf, the individual repays your loan if you don’t honor the repayment agreement.
So, if someone understands the risks that you might expose them to, they may opt to decline your request.
It’s impossible to access good credit cards
Since you have bad credit, fewer credit card companies will hesitate to give you their best deals if credit cards. However, there are credit cards available to those with bad credit. Unfortunately, you can not access as many credit cards as those with good credit scores.
Rent an apartment
Yes, that’s how serious it is. Most landlords would want to check your creditworthiness before they can rent you an apartment. And that’s where it will be tough to get an apartment once you have a bad credit history.
As I said, no one wants to associate themselves with those with bad credit.
If you have failed to manage your credit history, the business loan lender might think you will not be responsible enough to maintain your business. Therefore, they might find it hard to finance you with a business loan.
Expensive student loans
Some lenders might give you a student loan with bad credit, but trust me, you will pay much higher than those with good credit scores. That’s one reason you might find life hard in the university.
The bottom line
Now, you have seen how much damage you can get from having a bad credit score. So what you should do, focus on building your credit score. But more importantly, ensure that you stay out of debt, for it’s the best way to gain financial freedom.