Bad credit is a common experience for many Americans. Unfortunately, one common misconception about bad credit is that you have managed your finances poorly. In fact, there are many reasons why people have bad credit, and knowing why your credit score is low can help you improve your credit rating. Here are some of the most common reasons why people have bad credit:
Loss of a Job
The loss of a job and unemployment often result in bad credit. When a person’s source of income suddenly stops, it becomes necessary to use whatever finances left to pay the bills and buy food. When you are unable to pay off your credit card statements, your credit score will suffer.
Medical expenses can be an extreme financial burden, especially in cases of sudden illness or accidents. Not only will a person have to pay off the medical bills, he or she will lose income while unable to work. Sometimes, unpaid medical bills will be turned over to collection agencies, which will cause bad credit.
During a divorce, a spouse may have to pay legal fees or child support payments that exceed his or her monthly income. These added expenses can become a huge financial burden, making it difficult to pay off credit card or other monthly bills.
Death of a Spouse
The survivor of a spouse who has passed away will often be responsible for medical and funeral expenses. In addition, the overall household income will decrease, leading to a loss of financial stability. This difficult event can weaken the finances of even the most responsible person.
If you are experiencing bad credit, purchasing a used car is one great way to get your finances back on track. At Oak Motors, we offer in-house financing that will get you approved for a car loan. Purchasing a car from us is a powerful step towards improving your financial situation. To learn more about how we can help you, call us at 877-OAK-MOTORS.Categories: Credit Repair