3 Disadvantages of Having a Low Credit Score
Having a low credit score can hurt you in a number of different ways. Here are some of the disadvantages of having a low credit score.
Trouble Getting Approved — Whenever you have a low credit score, you will find that it is difficult to get approved for loans or credit. Lenders and credit card companies are going to be very skeptical about giving you a loan or credit.
High Interest Rates — Another disadvantage of having a low credit score is that you will have to pay higher interest rates. Whenever you have a low credit score, this means that you represent a higher amount of risk for creditors. In order to take you on as a customer, the lender has to increase the amount of interest that they charge you. This means that you could end up with higher monthly payments and more money being paid over the life of the loan.
High Deposits — When you have a low credit score, you will also find that many businesses are going to require you to put down a high deposit to provide you with service. For example, whenever you get a cell phone, the provider might require you to put down $200 because of your bad credit score.