The Benefits of Bad Credit: A Perfect Incentive to Use Ones Own Cash

Many American households carry at least $8000 worth of debt, and the fees associated with the debt sustains it. There are more one reason why people get in debt. Some fall for online scams, have more than one mortgage, buy food, pay bills or just buy a lot. Whatever the reason, it is just another addition to your household and miscellaneous monthly payments.

The juggling may be a simple thing to do now until unexpected issues arrive. For example, when a person is laid off, becomes ill or has a family member who becomes ill it take money to solve it. In addition, new repairs or expenses come up that forces one to choose between the debt and the issue. Some people may solve it by using one credit card to pay another. All is fine and dandy until it hits the limit or beyond. The debtor is then penalized with a late fee, over the limit fee, finance charge and a raise in the APR.

If one is at wits end, one may decide to pay what they can actually pay or not at all. The creditors will not here of any excuses, and will make themselves known. The debtor will be hounded day and night at any hour. The weekends and holidays will not stop creditors from calling you. They may even decide to call you everyday or three days in a row to ask you the same questions in reiteration.

They will sell your debt to a collection agency to hound you asking " How did you get into this debt?" each time they call. Some are kind while others will make you feel like a criminal. The news is that your debt is so many months past due, and you must make the minimum payment or full one. No one cares whether you are out of work or not. You could even be threatened with legal action, and writing your debt off as bad debt.

This is when the helpful benefits come into play. The creditors threaten to put your derogatory debt out where potential employers, mortgage companies, car dealerships or anyone can see your bad credit. I find this interesting, and I will tell you why. For all the temporarily out of work people whose debt is not enough to get a bankruptcy, blackening credit reports of these people can stop them from getting a job.

Moreover, when the debtor has no job, and the debtor ruined their reputation there will be no money. Therefore, the creditors want to keep all their customers as slaves on leashes for life on one debt. Creditors do not like their customers. Especially those who have bad circumstances. I've heard a customer service representative tell someone that they handle payment plans every day.

EVERYDAY! What does this say about the business or creditors? It looks, acts, and behaves as a shark with those in debt as prey. People who can afford to handle debt should be given the amount of $1000 on up. Those who are jobless or with terribly low income for their family size should not be given a chance. To be fair, low income individuals and families can at least be given a low amount of $300 to $500. Debts of high amounts are not from what is given, but the fees that make it continually rise. Meaning, creditors cause your debt to rise and then complain about it. Perhaps, it is the fault of all who sign up for the credit cards. Then again, it is the fault of those creditors for being too greedy for members, and accepting the unemployed.

After all that trouble, it should give you the perfect incentive to use cash. Find your hobby, promote your product and make extra money. Work it until you reach the amount you need to buy a car or dream home. What car dealer or home owner would refuse cash? This would eliminate your need to make mortgage payments, car payments or furniture payments. Pay off your debt entirely first.

Someone gave me advice to never get a credit card. After knowing first hand how they treat people, it is understandable why she said it. Now, banks with a visa or master card symbol can be used as a credit card. The best thing about that is that it will be your own money. Using your own money can help you learn to be responsible. If you must have another credit card after paying off your major debt make it American Express. I've heard that American Express expects you to pay what you spend. This is good practice for someone who wants to raise their credit rating. You can also get a lawyer to fix your credit rating, so it will show current information.