5 Things You Can’t Do with Bad Credit

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Everyone takes their credit score for granted until they need a loan. But, the simple fact is there are things you can’t do with bad credit.

The debt-free crowd will tell you it doesn’t matter, that you should strive to pay off all debt and not use borrowed money. It’s easy to think you won’t have to worry about your credit score, but it’s not that simple.

Before you miss that payment, check out this list of things you can’t do with bad credit and get ahead of your credit problems.

The lack of mortgage options for bad credit borrowers got so bad that the Federal Housing Administration (FHA) created a new program for people with poor credit scores. Borrowers with a credit score of 580 or higher on the FICO scale only need to come up with a 3.5% down payment.

Try Buying a House on Bad Credit

Miss that credit score cutoff, though, and even the FHA requires a 10% down payment on your loan. The FHA also requires a debt-to-income ratio of less than 43%, meaning your monthly debt payments can’t be more than $4.30 for every $10 you make each month.

Ever wonder why you need your social security number on applications to rent a house or apartment?

Potential Landlords Will Check Your Credit

It’s because landlords check your credit before they sign that rental agreement. Besides your credit score, they’re looking for how you pay your bills and how often you miss payments.

Potential employers are looking through your credit report to get a sense of your financial responsibility. If you’ve missed payments or haven’t followed through on your credit agreements, will you follow through with your responsibilities at work?

Want a Good Job? Get Good Credit First

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