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Having a bad credit history appearing on your records would not only give you a hard time borrowing credit or money, but also affect other parts of your life more than just your finances. Here are the information about bad credit history and how it could affect your life, as well as some advice on how to deal with it when you do get it.
Bad credit history is accumulated by irresponsible ad reckless consumer behaviour. Such behaviour includes not paying your bills on time, maxing out credit cards, getting bankrupt, and a lot of other similar acts. And these acts would show up on your credit report and be reflected on your credit score, showing that you lack credit worthiness and that you are an irresponsible consumer.
The main problem with having bad credits is that money lenders and credit card issuers would not trust you in financial matters, giving you a difficult time to borrow money and credits for your needs. The issue with money lenders and credit card issuers is that because they are part of a for-profit business where they lend money and receive them back with interest, they would avoid borrowers with bad credits because this shows that might not be able to pay their borrowed money back much less with interest.
There are other ways that a bad credit history could give you a difficult time. One such example on part of your life that bad credits could affect is the workplace. If you are looking to get a high-paying job or a promotion in a certain company, you would have plenty of disadvantages with bad credits on your record. Employers check the credit worthiness of someone before they hire or promote them, and if they see that you have high amounts of bad credit then they would be reluctant in doing so. Other such examples include making expensive purchases, maintaining a business, supporting a family and buying mortgage.
The only way you could avoid this situation is to simply be a responsible credit user. You simply have to pay your bills on time, continuously and thoroughly monitor your credit accounts for signs of identity theft, fulfil your financial contracts and agreements, and avoid bankruptcy as much as possible. Irresponsible consumer behaviour is almost always the main cause of getting bad credits, so be sure that you don't do anything stupid with your money and accounts. Otherwise, you would have plenty of financial trouble and more waiting for you to sort out if you do.
If you do have plenty of bad credit on your records, then you need to sort them out as soon as possible. Fixing bad credit is a long and tedious process, and could even take more than a year depending on how serious your situation is. You could start doing so by thoroughly checking on your credit reports and correcting any errors you find there, repaying outstanding debts especially those with high interest rates, coordinating with a credit counselling organization to help you with your situation, and living within your means.
