Having a poor credit score means that you are a riskier borrower when compared to someone with a better credit score. It reveals that as s consumer you cannot handle new credit as they might be overwhelmed by current debt that they have. In this respect, a poor credit score would mean that lenders are highly unlikely to extend new credit to you.
A consumer with a high credit risk rating implies that lenders are likely to charge that consumer a higher interest rate for new credit.
The risks of a poor credit score include:
- Being charged high interest rates on credit cards and loans;
- Credit loan applications may be declined;
- Difficulty getting approved for a flat / house to rent
Landlords are checking one's credit report before offering a tenant a place to stay and signing a lease agreement. If the credit score is poor, one might have trouble finding a place to rent.
- Higher insurance premiums;
- Difficulty getting vehicle finance approved when purchasing a car;
Knowing and understaning your credit status is vital, especially if you are going to be applying for any kind of finance in the future. Debt Sage can pull your credit report and you’ll get an in-depth view of how much debt you have and assess your credit worthiness.