While it may indeed sound like a harsh statement, it is certainly true in that the government cannot stop the widespread discrimination against certain individuals and these are those people with less than perfect credit. This sad fact is literally destroying families and individuals alike.
Over 70% of the families across the United States have heads of household with less than perfect credit. The majority of these individuals have truly poor credit. While this might not seem like a huge problem, let's take a look beyond the obvious and see what it brings up.
Of course, the general observer would state that this is no big deal. These folks can't rent a car, order flowers, or pay by plastic for a late night home shopping network binges, but let's become more of a professional observer. The individuals that have poor credit are oftentimes excluded from certain types of employment. A call to over 16 major human resource companies acoss the nation stated that they routinely pull credit reports and that these reports weigh in on the personal character of the applicant. This in itself hinders finding employment in an already unstable economy. If they are fortunate enough to find employment, it is usually minimal wage type work that spirals off into other areas of family strife. They are faced with working two jobs to even attempt to provide, both mother and father are forced to work these long hours creating latch key kids, and much more.
With poor credit, a person is normally stuck in the rental trap paying a great deal more than they can afford in an overinflated rental industry. Not to mention that the one saving grace being creative real estate, where these folks could possibly structure a rent to own, or seller financed transaction to get into homes, are being outlawed. Legislators in Maryland, North Carolina, Texas, And Kentuckey have already passed legislation to do this and other states are on the way. This is nothing more than society pushing the poor credit individuals into an even smaller corner.
Interest rates are on the climb as well. Of course this will effect everyone, but again who will it effect the most? You guessed it, the poor credit individual. Interest rates are higher for investors and they will pass this onto tenants (poor credit folks). If an individual with poor credit was able to locate a loan for a home, the interest rate would make the payment literally undoable and they would either be forced to turn down the opportunity and continue renting or they would waste their savings and most likely lose the house to foreclosure thus damaging their credit even more (over 2 million poor credit buyers will get foreclosed on in 2006 and be back in the rental trap worse off then before) as they can not sustain the inflated payments arising from the high interest rates.
The individual with poor credit also must guard against the sharks and hustlers preying on their desire to leave this mess they are in. Fly by night businesses touting that they can repair credit instantly, get people a new credit file, get them a way to make so much money overnight that their problems will be forgotten, are all to prevalent in our society today. Unsuspecting individuals looking for some kind of answer seem to always lose the money they cannot afford to, by purchasing these fairy dust type dreams.
There is no easy answer to this situation that we face. To be honest, there is no way that the government can ban higher interest rates or companies rights to approve poor credit people any more than they can ban bad credit. With our free, capitalistic society (the greatest in the world), comes problems. For those individuals that are faced with poor credit, the answer lies within yourself. There truly are ways to climb out of the rut that you are in and it does not have to take years to do. With most credit reports containing blatant errors, a person can upgrade their credit quite easily. There are also ways to add things to your files that will make you more appealing to creditors and especially employers. Most people do not know that you can add character references to your reports. This in itself can add a distinct advantge when looking for employment. Adding positive credit is a very simple aspect as well. You might not be able to remove everything negative, but at least cancel it out with something positive.
The bank, the Government, mom and dad, etc. are not going to change your situation. The thing is though, with a little persistance and connecting with some solid sources that will assist you, the quality of our lives can improve dramatically.
Patrick Zanders is the co-owner of ACR Systems. A financial services consultation company that assists people in poor credit situations for no cost. He can he reached at http://www.acresystems.net or pzanders@comcast.net
