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How
Bad Credit Affects You
Very few
things in life can have a more devastating effect on your lifestyle
than a poor credit score. A low credit score can cost you hundreds
or even thousands of dollars per month.
Credit
Cards
Most prime
credit cards are entirely out of reach to consumers with bad
credit. And the few credit cards that are available to them
(known as "sub-prime" cards) typically require exorbitant setup
fees or recurring monthly fees, offer very low credit lines,
often require cash deposits, and in most cases do not even report
your positive credit activity to the credit bureaus.
Automobile
Financing
If you are
making payments on a car, you are probably paying between $5,000
and $9,000 more just for having bad credit. This added interest
shows up every month in a higher payment. Take a look.
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$20,000
car paid over 5 years:
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CREDIT STATUS
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RATE
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PAYMENT
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COST OF BAD CREDIT
|
|
Perfect
Mildly Damaged
Damaged
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10%
14%
20%
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$424.94
$465.37
$529.88
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$0.00
$4,722.54
$8,593.30
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Home
Mortgage
Bad credit
in auto financing can really hurt, but it is nothing compared
to the cost of bad credit when a home is involved. A typical
home can cost between $50,000 and $130,000 more in interest
if you are buying the home with bad credit.
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$100,000
home paid over 30 years:
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CREDIT STATUS
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RATE
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PAYMENT
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COST OF BAD CREDIT
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Perfect
Mildly Damaged
Damaged
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7%
9%
12%
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$655.30
$804.62
$1,028.61
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$0.00
$50,155.24
$130,791.63
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Learn More. |
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