What to Do If You Have a Poor Credit Score

What to Do If You Have a Poor Credit Score

Poor credit history can become your worst nightmare if you’re in a financial crunch and need a loan to get out of it. That’s when you realize how irresponsible overspending on your credit card and slacking off on credit payments was.

What Are Good and Bad Credit Scores

If you’re unsure where you stand with your current credit score, check this out. These are five categories of credit scores, as defined by FICO.

  • 800+: exceptional
  • 740-799: excellent
  • 670-739: good
  • 580-669: fair
  • 579 and less: poor

Statistics have proven that the average credit score among Americans is 711. If your credit performance is below average, that’s something to consider. Re-evaluate your monthly spending, budgeting, assets, and debts to see where you’re going wrong.

Consequences of Bad Credit

· High Interest Rates

Whether it be for a home loan or a credit card, your credit performance dictates the kind of interest rate you’ll get. Low credit score holders will have to settle for loans that are expensive to pay off and credit cards that don’t come with as many perks.

· High Mortgage Rates

A bad credit score makes a statement for your lack of reliability as a debtor, and lending institutions are wary of loaning out to such individuals. It shows that you pose a high risk of default, which will mean bad business for the lender. With a poor score, it’s hard to find a lender who will loan you money. And when you do, you have to settle for a high mortgage rate.

· Business Loans

When you’re starting a business, you need money to cover the fixed costs and variable costs for the short run. Entrepreneurs often seek financial assistance from lending institutions, but a bad credit score can impose roadblocks. You need a good credit history to make a case for why you deserve a loan and how prosperous your business can be.

But a bad credit doesn’t/shouldn’t mean you’re doomed indefinitely. Look around for private lending institutions that don’t discriminate on the basis of good and bad credit. GCP Fund has helped many enterprises fulfill their financial requirements with their help.

If you’re interested in private lending in Vancouver, reach out to GCP Fund today. They specialize in extending bridge loans, asset-based financing, and other hard money loans in Vancouver. Reach out at +1-800-514-7350 or write to them at contact@gcpfund.com.

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