bad credit sucks

Bad Credit Sucks, So Keep An Eye On It

My Strategic Dollar Credit, Guest Posts 5 Comments

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Today I have a second guest post from Dan Miller, a content contributor at Bizzmarkblog.  He is a Payments officer with nearly ten years of experience in banking and international payments in the Australian banking sector. Dan has a masters degree in finance and banking. He is married and also a father of a beautiful little girl.

Dan previously wrote an article here at M$D – Loan Types -Which One Should You Apply For? With everything going on related to the Equifax breach, it’s more important than ever to make sure you’re aware of your credit report and monitoring it for fraud or incorrect information. Enjoy! 

Do You Know What’s On Your Credit Report?

Having a bad credit score can hurt you in more ways than you realize. I made the same mistake, as I thought a credit score was just a fancy name that finance people use in their unique language (like lawyers and doctors). Boy was I wrong! Regretfully, I didn’t realize what it meant to have a bad credit score, up until it started to backfire.

Back in 2008, I lost my job at a restaurant, because the joint had to close down due to recession. “Oh well, no big deal. I’ll find another job eventually” – I thought. I went for nearly a year before I found employment again and my bills kept piling up. Of course, I’d pay them as soon as I managed to scrape enough money from off-the-books freelance jobs. Once I found a new job, I wanted to get a loan to buy an apartment, but the lender offered me a loan with an insanely high-interest rate that simply wasn’t realistic. When I asked what all that was about, he replied that due to my bad credit score, I present a high risk – therefore the high-interest rate.

Only then did I realize that my overdue bills and lack of employment caused a lot of damage to my credit score. I decided to get back on track and clean up my score. Here is what I did to make it happen, and hopefully my story will help someone avoid this kind of an unpleasant situation.

Found The Problem

At that time, I had no idea what to do, so I asked my friend who knew a bit more about finances than I did, for advice. She told me to check my credit reports with a company like Ondeck and start from there. So I did, and I still had no idea what I was looking at, but she explained to me that my overdue bills are hurting me, which I already knew. But what I didn’t know is that my credit cards, which I was using to get by while I was still unemployed, were also hurting me.

I managed to accumulate $18.000 debt on my credit cards. I decided to straighten things out, so I started paying bills on time because now I could afford to do it. Also, I started paying off my credit cards little by little, by paying the monthly minimum with a bit extra whenever I could. Also, I was doing my best not to use my cards but pay for everything in cash instead. I managed to pay off most of my credit cards and close them, leaving only two.

bad credit sucks

Good effort but bad results

Two years had passed and my credit score improved just a bit. Something wasn’t right and I intended to find out what it was. So, I talked to my friend again and she recommended that I consult some financial experts and figure out what was wrong. Therefore, I went and consulted with a company my friend recommended that helps people repair their credit history and they agreed to revise my reports.

Fortunately for me, they found an issue in my report, which stated that I’m still unemployed. Go figure! Apparently, my employment status wasn’t updated due to some error and that’s what has been causing my credit score to dawdle all that time. So I did what they instructed and went to my bank to complain. They updated my employment status and after a year, my credit score improved and I managed to get my loan to buy that apartment. I couldn’t believe that all that credit score stuff was so complicated and that a simple mistake can cause such a delay in a score improvement.

Bad Credit Sucks, So Keep An Eye On It

As you can see, I did what I could to save my credit score and you can say I was lucky, which I was by the way. My advice is – check those credit reports regularly and make sure you pay your bills on time. Don’t make the same mistake I did!

Have you ever found an error on your credit report?

Comments 5

  1. Wow I had no idea employment status affects your credit score! I thought that was just something banks consider separate when looking to give you a loan. I have never found an error on my report but I definitely have kept a close eye on it over the past year because I was planning on buying a house.

    1. Post
      Author

      Keep looking at your credit! With all the fraud and hacks going on, making sure you’re aware of when you’re credit changes is super important!

  2. Credit history is such an odd thing to me – for something that’s so engrained in our lives and so impactful to us, we have surprisingly little visibility into it. We really should be able to get our credit reports (and ACTUAL scores) any time we want, or at LEAST more often than once a year. It’s unbelievable!

    Thankfully we’ve got great credit right now, and it’ll bump down a bit when we get our mortgage next week but that’s no big deal. My wife did have one bad mark on her report. It was an account for which she was an Authorized User, but she’d never even used the card or anything. There was one late payment on there, from 2-3 years ago. It’d been resolved, and the card paid off and not used again, but it still was a bit of a surprise to us when we applied for mortgages. It only showed up on one report (TransUnion).

  3. Now, more than ever, this is pertinent!

    I’m as frustrated as everyone else with the massive breach, and disappointed that neither of the Big 3 showed up to the NY Senate hearing yesterday.

    Following this closely!

    1. Post
      Author

      Definitely! I think the public has the right to be extremely upset about the way this situation has been handled and I hope it leads to some much needed changes. Thanks for stopping by!

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