A bad credit card debt can be reported on your record for up to seven years. But there may be some life changes that come up inside of those seven years that would require you to settle the debt with your credit card company immediately. Even though you may be in a desperate situation, when you do decide to settle your credit card debts, don't let the creditor know exactly why you have had a change of heart. That could give you a disadvantage in negotiations.
When Trying to Buy or Rent a Home
When you have bad credit card debt listed on your credit history, this can cause you to receive higher interest rate quotes from mortgage lenders. Even just a half point difference in your interest rate on a home loan could cost you thousands. Many lenders will tell you to clear up your bad credit card debt to raise your credit score, then come back in a few months for a loan package. An unsettled credit card balance could also cause you to be denied for an apartment. So if you have future plans to move or buy a home, call your creditors or the collection agency to negotiate a settlement.
When Looking for a New Job
Employers look at credit history when making hiring decisions. Companies are looking for honest, responsible workers who meet their obligations---if they see that you have a bad debt on your credit report, this could be the difference between a "yes" and a "no thanks." So if you are planning to transition into a new job or career, you need to work on settling your bad credit card debt immediately.
When about to Get Married
A survey done by Relationships Australia of men and women cites "financial stress" as one of the main reasons why people get divorced. If your partner doesn't know that you have bad credit card debt, and you plan to get married soon, this is an ideal time to start trying to settle your bad debts. Call to negotiate a settlement figure at least six months before your impending nuptials. Be honest with your partner about the debt and your plans to pay it off before you tie the knot so that there will be no secrets going into the marriage.
0 comments:
Post a Comment