Ins and outs of Bad Credits so that you can Live A Life of your Own

Do you know what credit score is?? It is commonly denoted with the FICO score. FICO or Fair Isaac Corporation is a company which provides credit scores. When you have a FICO score which is less than 620, it indicates towards bad credit. Surely, the term "bad credit" is a nightmare for most of the debt borrowers!! It also matters when you go for equity release mortgages. Let us discuss the matter in brief.

How can your credit get bad??

To avoid the circumstances of having a bad credit record, you should know first the reasons of having bad credits.

Bad credit records don’t only come with your faults in returning the credit amount. But, you can also have bad credit records, if you have never borrowed any credits in the past. It indicates that you have no payment history.

Bad credit records can be also generated through your bad repayment history. Whenever you miss a payment, your lender informs it to the credit bureaus. Thus, it results in bad credit records.

What are the effects of bad credit??

Bad credit is surely a big factor when somebody is going to have a loan or mortgage. The mortgage lenders generally don't like to consider people with bad credit records. So, it is very important for you not to have a bad credit record to have a mortgage of good amount. With good amount, I meant to say that a mortgage lender judges your financial capacity depending upon your credit records and decide the mortgage amount according to that. So, with bad credits they won't let you have a mortgage of a good amount.

So, when you are going for applying to the equity release mortgages for securing your retirement, bad credit records can raise its hands over that also, which won't be good enough for having better opportunities.

How you can come up from bad credit records??

Firstly, you need to understand exactly how bad your credit scores are and for that you need to have "tri-merged credit reports".

After getting hold on your reports, start improving your credit records.

If your credit record is bad because of the reason that you never have been into credits, apply for a credit with any local business you want. Then, make sure that you repay the amount promptly.

You can start paying your bills on time to avoid bad credit records.

Releasing equity on your property can also be a useful way of clearing the bad credit records. By unlocking a lump sum amount through equity release, you can also start paying up all the outstanding debts to get rid from the tags of bad credit records.

So, what are you waiting for?? Apply to the equity release and fire a bullet for serving both the purpose of securing retirement with fixed income plans and escaping the consequence of bad credit records for possessing more financial holds.

Author bio : Jack Cage is a freelance content writer who loves to write. From his interest in writing and financial issues, he developed a skill for writing on financial topics. A blogger by profession and passion, he has many years of expertise on writing on all about fiance.