If you make the decision to purchase on time in order to build your credit score, know this one thing: the creditor is only your friend as long as you are increasing your debt and paying your payments on time. If you fall upon hardship and ask for assistance, the aid offered will be more beneficial to the creditor than to you in the long run. A mortgage company that offers a $200.00 payment diversion for six months and then requires a $2,000.00 balloon payment at the end of that term is hardly looking out for your best interest.
Many Americans are victims of the failed economy and have been forced into unemployment. To this end, they are unable to make the standard minimum payments to their debtors. The heartless and uncaring nature of the people a distressed customer has to deal with is utterly appalling! If your hope is to avoid a delinquent status and prevent your account from going to collections, you may be told there is no help for you. You must be employed and able to make a payment regularly in order to qualify for help. If you do not have an income, which is often the reason you need assistance, you may find yourself in the company of a collections agency or even an attorney, being summoned to court. This holds true even if you have been making regular payments.
Creditors often do not care about the client, just the money that client contributes. It seems in the best interest of a creditor to offer a program where the troubled customer can pay off the principal balance, at least allowing them to recover the original debt acquired by the client. However, rather than helping a customer to stay out of a delinquent status, they often force them into the position of bankruptcy.
Undeniably and quite sorrowfully, the debt belongs to the person who was once hopeful of building an impressive credit score. The once valued customer is now badgered with incessant telephone calls at all hours of the day and night – all for the sake of being able to borrow a higher amount and increase debt at a later date. After two years of paying only a bit more than the minimum payment due with no additional charges, one’s balance on a credit card can and often will be higher.
Something happens to the average citizen when they receive that shiny card in the mail. It is very tempting to buy what you want now without considering whether or not you will really use it later or even want it after the initial infatuation passes.
Whether or not the accounts ever reach a collection status, indebtedness is a form of slavery and often college-aged people are targeted by creditors so that the cycle starts early. What creditors will not tell the customer is that good credit can be built by paying the full balance off every month and simply by paying your utilities and rent on time every month. America is in a crisis right now. Everyone is hurting. Much of this pain is a result of wanting what everyone else has and instead of saving for it, going out and buying it with plastic and not cash.