Lots of young people – typically young adults in their 20s – have bad credit. In fact, at times it can seem as if youth and bad credit are a perfectly natural match. But whether that’s true or not, it’s important that you get your bad credit fixed as soon as possible. Even though you are young, there are a lot of consequences with bad credit that you may not be fully aware of.
Youthful Mistakes are Inevitable – Especially With Credit
Part of the problem with credit is that young people are often unfamiliar with exactly what it means. Credit is perfectly normal and necessary, and it’s common throughout the economy. But let’s face it, credit isn’t exactly a subject that’s taught in school, or even in college. And in many households, credit isn’t discussed at all, especially with kids.
The result is a generation of young people who are virtually illiterate when it comes to credit. That’s a recipe for credit disaster.
While virtually everyone can see the benefits of using credit to pay for purchases for now, such as a car or a college education, what’s less appreciated is the requirement to pay back the loans after the fact. This is where a lot of young people don’t necessarily understand all of the implications.
Unfortunately, borrowing is easy these days, but repayment is not. Not all young people understand that lenders will generally not give them special accommodation of debt obligations while they are trying to establish their lives. In the meantime, debt payments are missed, resulting in bad credit.
And if you don’t have a whole lot of credit to begin with, any bad credit at all can be assigned a poor credit rating, evidenced by a very low credit score.
Bad Credit Will Not Get Better With Age
There may be a temptation to think “I’m young, and this bad credit problem will eventually work itself out”, but that’s not usually how it works. Bad credit only turns to good credit with a lot of heavy action on your part. Unlike the human body, your credit profile doesn’t heal itself and get better.
The end result of inactivity when it comes to bad credit is more bad credit. Unfortunately, many of the people who have bad credit in their 30s and beyond already had bad credit in their 20s. That’s because bad credit has a nasty habit of building on itself.
It’s also a fact that bad credit can become a habit. You get used to paying your debts late, or letting them lapse into collection, early in life, and you may very well continue to handle credit in that way going forward.
Bad Credit Can Keep You From Moving Forward in Life
Probably the biggest problem with bad credit is that it doesn’t exist in a vacuum. In reality, it can affect virtually every area of your life.
For example, when the time comes that need to buy a car – or a home – bad credit can limit your options. It might mean that you will pay a higher interest rate on any loan you are able to get. But it might also mean that you are unable to get credit at all. That would mean that whatever it is that you are planning on buying won’t happen.
But the problems with bad credit don’t stop at applying for loans. You could also be denied an apartment, or you might even be excluded from certain jobs due to a poor credit history. This can happen with certain management jobs, as well as any position where you will be handling money. Bad credit can be seen as an indication that you lack sufficient responsibility to handle money for an employer.
Collectively, this will mean that you will be unable to do all of the things that you want to do in your life.
Why “Someday” Needs to be Now
When you are young, it’s very easy to rationalize that you will deal with certain obstacles in the future. But since your future will be closely affected by your credit history, fixing it needs to be a priority. The future that you envision may be extremely limited until you overcome this hurdle.
Bad credit functions as an anchor that will keep you from buying the things that you need to, such as a car or house or even a computer. But it can also impair your ability to earn a living, by preventing you from getting a better job. That’s why you can never trust fixing bad credit to “someday”. The sooner you get it fixed, the more options you will have across the board in your life.
How to Get Your Bad Credit Fixed Now
If you have bad credit and you want to get it fixed, you might find that doing it is like cutting a path through a thick jungle. The problem is that the creditors understand the law, and know how to make it work to their benefit. You probably have no such understanding, and will find yourself facing demands and threats, framed by scary legal language.
You can handle this yourself – but you don’t have to. If you decide to outsource this task then you should work with a law firm that specializes in credit problems. They have the experience, and they know credit law, and can make it work to your advantage at a very reasonable price. That will enable you to overcome your credit problems faster and more completely than virtually any other strategy you can try.
If you’re young, you need to clear the deck of any problems that may be limiting your future progress. Bad credit is one of those problems, and the sooner you get it fixed, the sooner you can get on with your life and all of the dreams that you have for your future.