What happens if I have a poor credit report?

A poor credit report may keep you from buying a house, financing a car, getting a credit card or personal loan, setting up phone service, renting an apartment, getting insurance, or even landing a job. 

Why? Businesses want to know if you’ll pay their bills on time before they grant you permission to use their services. They evaluate not only your creditworthiness but your financial responsibility in general.

Potential employers may also check your credit score and payment history as part of the hiring process. Some positions require you to be responsible for certain assets or to handle money. If they discover that you don’t pay your bills on time, they may decide you aren’t financially responsible and you may not get the job!

All is not lost if you have poor credit. A lender or business could approve your request but may change the terms—increasing the interest rate or adding fees—of a potential agreement. Having poor credit can cost you big bucks if lenders will only grant you credit at a much higher interest rate over several years.