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5 programs for the credit-challenged consumer

17th February 2016 Print

When you get older, you come to realize just how important your credit is. Without a decent credit history. obtaining even the bare necessities like housing or a vehicle can become challenging (and costly). It is quite common to go through financial pitfalls that ultimately impact our credit. Whether it’s maxing out a credit card or falling behind on payments, once negative marks find their way on the credit history it can be very difficult to recover.

In times past, a person with bad credit had no other choice but to wait the allotted seven to 10 years for negative ratings to be removed to restore their credit status. However, much in part to the common occurrence of bad credit and the downfall of the global economy, many financial institutions and government programs have made it fairly simple for those with fair, poor, or no credit at all to sustain a decent quality of life. Here’s how:

1. Credit Counseling

One of the most common types of programs offered to the credit-challenged is credit counseling services. Through these services consumers are able to learn how to get out of debt and more effectively manage their money. Trained credit counselors evaluate customer’s financial status and help them come up with a plan of action to get their debts paid down, and consequently improve their credit status. 

2. No Credit Check Lending

As lending institutions strive to win the business of the average consumer, they realized that they needed to implement eligibility changes. Companies such as Crest Financial offer consumers the opportunity to borrow funds without the dread of having their credit checked. Through these unique financing options for consumers, Crest Financial is also able to provide incentives like zero interest, low monthly payments, and routine reports to the major credit bureaus which can aid in improving the consumer’s credit score. 

3. Debt Consolidation Programs

In instances where the debt has reached an overwhelming amount, consumers also have the option of enrolling in a debt consolidation program. Through this program, applicants are able to qualify for a lump sum of cash to pay off their debts. In doing so, the negative markings are edited and/or removed from the credit report. By paying back the debt consolidation loan in a timely fashion, consumers are able to once again build their credit in a short amount of time. Other debt consolidation programs might include the option to work with credit experts on negotiating lower payments through your creditors so that your monthly payments are smaller and easier to manage. 

4. Credit Repair Services

For the credit-challenged consumer that doesn’t necessarily have a large amount of debt, but does have a poor credit history that seems to haunt them wherever they go, credit repair services could prove beneficial. Through legitimate credit repair firms, eligible applicants can work with attorneys who specialize in credit repair to get negative and inaccurate findings removed from their credit report. Rather than waiting seven to 10 years, consumers have found that credit repair services can clean up their credit history and improve their score in a short timeframe. 

5. Government Funded Loans

Ever try to purchase a home with less-than-stellar credit? If you’ve made the attempt then you know that while you can obtain a bad credit mortgage it comes with a hefty price tag. Not only are you entitled to pay more towards interest, but you may be required to put more towards the down payment of the home, and may also find a difficult time locating a lender that will approve you for a decent amount. 

Government laws however have made things a bit easier for those who are struggling with their credit. Rather than penalize them and make homeownership an extreme financial burden, government officials have established what are known as FHA loans. These loans are funded by the government but are designed to provide those with fair credit and low income to own a home. Eligibility requirements are typically a lot looser than through traditional mortgage providers and there is also financial assistance including low interest rates and down payment assistance. 

Each of the above discussed programs are designed to help those who have a shady credit history. While it certainly pays to have a decent credit score at all times, when things get out of hand, there are avenues you can take to reclaim your life. Through the above mentioned programs and opportunities, you’re able to obtain financial education, assistance and looser eligibility requirements so that you can still invest in the things you find most valuable to you.