In the last episode of the Netflix hit series “Love is Blind” season 5, Izzy and Stacy made it to the altar but did not get married. One of the reasons for Stacy's decision was her lack of trust in Izzy due to his bad credit score. This story highlights a bad credit score's impact on your life, even in areas you might not expect.
Reason for Stacy's decision was her lack of trust in Izzy due to his bad credit score.
A bad credit score can make it difficult to get approved for loans, credit cards, and other forms of credit. This can mean that you have to pay higher interest rates, or you may not be able to get the credit you need at all. This can make it difficult to buy a house car, or start a business.
In addition to financial difficulties, a bad credit score can also hurt your personal life. For example, some landlords and utility companies may check your credit score before approving you for housing or services. This means that a bad credit score could make it harder to find a place to live or get the necessary utilities.
Disadvantages of Having a Bad Credit Score
There are several reasons why you should avoid having a bad credit score. Here are a few of the biggest drawbacks:
- Higher interest rates: Lenders view borrowers with bad credit as a higher risk, charging them higher interest rates. This means you will have to pay more for the money you borrow.
- Limited credit options: If you have a bad credit score, you may not be approved for loans or credit cards that you need. This can make it difficult to achieve your financial goals.
- Higher insurance premiums: Insurance companies also use credit scores to set rates. This means that people with bad credit scores may have to pay higher premiums for car, homeowners, and other types of insurance.
- Difficulty getting approved for housing: Many landlords and property managers check credit scores before approving tenants. This means a bad credit score could make finding a place to live harder.
- Difficulty getting approved for utilities: Some utility companies check credit scores before approving customers. This means that a bad credit score could make it harder to get your electricity, gas, or water turned on.
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Tips on How to Improve Your Credit Score
There are several things you can do to improve your credit score, such as:
- Make all of your payments on time and in full: Paying your bills on time and in full is crucial to maintaining a good credit score. Late or missed payments can negatively impact your score for up to seven years.
- Keep your credit utilization low: This means that you should keep your credit card balances low relative to your credit limits.
- Avoid opening too many new credit accounts: When you apply for credit, lenders conduct a credit check, leaving a record of the inquiry on your credit report. Applying for multiple credit accounts within a short period can negatively impact your credit score.
- Dispute any errors on your credit report: You can get a free copy of your credit report from each of the three major credit bureaus once a year, for e.g. experian.com. Review your credit report carefully and dispute any errors you find.
What Would You Do in Stacy’s Position?
Stacy's story is a reminder that although love may be blind, bad credit can be a dealbreaker for some people, even in a relationship. If you are in Stacey's position, it is important to consider your needs and expectations before deciding whether to proceed with the marriage.
If you are concerned about your partner's bad credit, consider having a serious conversation with them about their financial situation. This includes discussing their credit score, any debt they have, and their plans for improving their credit. It is also important, to be honest with yourself about whether or not you are comfortable with the financial risks of having a partner with bad credit.