Last year, a huge percentage of people were reported to not have checked their credit reports even at least once, and the people who most need to check their scores, namely, those with bad credit histories, are those who refuse to review their credit reports. This is due to the extra-charged fees to people with rather questionable credit histories.
The recently passed CARD Act, however, has given each citizen the privilege to view their credit scores for free once each year from Equifax, Experian and TransUnion, the three leading consumer agencies. As of late, Washington was pushing for free credit reports even for people with bad credited histories. Sen. Mark Udall, D-Colo., among others, is one of this amendment’s supporters and has repeatedly voiced his support.
These mandates supposedly would have given citizens more knowledge and wisdom in handling, maintaining and building their credit histories.
The case does not seem to be true. More than a third of the citizens completely have no idea what their credit score is, and the National Foundation for Credit Counseling (NFCC) reports that an outstanding 65 percent of the credit-carrying population did not bother maximizing the privilege of being able to see their scores.
The explanation from this phenomenon, according to NFCC, is that people with bad credit histories seem to think the problem will vanish as long as they refuse to look at their scores. As a matter of fact, the problem is exacerbated; the consumer, without knowledge of his or her credit reports will never be able to devise ways of rebuilding their credit histories. For instance, if the person is aware of his or her problematic credit reports, he or she would know to regulate spending habits. Knowledge of the credit reports also gives the person the edge in wise decision-making.
The government, as well as other consumer agencies and experts have repeatedly issued fair warnings of the impact bad credit scores have on one’s lifestyle. Among others, the role of credit histories is essential and highly significant, and inadvertently affects one’s purchasing and transacting power. Credit histories are linked to transactions and purchases such as mortgages, loans, job-hunting and auto or car insurance transactions. In a nutshell, the worse one’s credit history is, the harder it will be to get any of the previously mentioned transactions. More specifically, a bad history can result to termination from a job, refusal of an employer to hire the person for a job, difficulty in signing up for loans, higher auto insurance premiums, and more expensive mortgage payments.
Experts say that Americans have to consider fixing and maintaining their credit histories. Moreover, the trend of staying well into debt accordingly could be a reflection of the country’s economic state.
