If you answered yes to the above you need to understand your credit and why “good credit” is an absolute necessity in today’s economically challenging times. You “must participate in your own recovery.” Yes, that means You need to be wise about your credit and debt situation. Not only wise, but realistic.
Does Enough Good Credit Offset Bad Credit?
Any amount of bad credit can be devastating to your chances of being approved by a credit grantor. Most credit grantors don’t even look at your credit report; a computer does. The computer pulls your credit report, rates your credit standing, income, indebtedness and stability and then the computer spits out an acceptance or denial. Even one or two slow pays will usually trigger a loan denial. The slightest amount of negative credit could cause the interest on an auto loan to skyrocket. You will probably find that even a “little” bad credit, regardless of how much good credit you have, becomes a barrier to being approved for any line of credit.
Does Paying Off Past-Due Accounts Clear Up The Negative Status?
Unfortunately, no. Paid but at one time delinquent debt still shows up as a severe negative. It is important to remember that credit reports don’t just show your current credit status, but they also show what your credit situation has been in the past. Therefore, past delinquency, collection activity or a charged off listing does a great deal of damage to the credit score, even if it was paid off. This is one of the ironies of the credit reporting system; paying off your past due debts does little to immediately increase your credit score and may actually make the score worse.
Call me directly at (949) 459-6888 or send an email to mailto:CreditNDebtWise@gmail.com.
Gail P. Rogers
Your Debt Resolution Expert
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