Jan 18, 2012

Disadvantage of Low Credit Score

There are many disadvantages of having a low credit score. The most obvious one would be approval when applying for a loan.

Having a low credit score can add much stress to your life and even affect your relationships. When you have a low credit score businesses such as banks consider you a high risk when making a loan request. If you are eventually approved for a loan you can be sure it will be at a high rate of interest. Another disadvantage would be high deposits that companies such as utilities and cell phone compaines will require of you if you have a poor credit score. Many apartment complexes will check your credit score before renting to you this could cause you not to be approved.

There are ways to improve your credit score such as applying for a credit card with a security deposit make sure this company reports transactions to the credit bureau. If you keep up your payments it will reflect well on your credit score. There are many organizations that have programs to give free financial advice for people with imperfect credit. You should go to one of these and get some tips on improving your credit worthiness.

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