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Why does it seem that lenders only look at credit debt?

Date: Fri, 02/23/2007 - 08:28

Submitted by anonymous
on Fri, 02/23/2007 - 08:28

Posts: 202330 Credits: [Donate]

Total Replies: 7


I keep running into the question...how much credit card debt do you have? The problem is that my debt isn't just with credit cards...that's actually a small part of it. I have tax debt, utility bills debt, rent debt, debt to the U.S. Navy, and credit card debt. I need to dig myself out of this whole, but it seems that creditors are only looking at the credit card debt when I ask for the loan amount I need. What can I do?


Welcome

To answer your first question, it's not the only factor that determines your risk, it's the factor that's preventing you from getting a loan at this time. In the past I was constantly being denied due to accounts not being old enough. But I'm getting away from the real question: What can you do?

If you provided your phone number when you signed up, you should recieve a call soon from a credit counselor. They can help you with the process of getting your debts paid down, in part by negotiating for lower interest rates or settling or other measures that would be appropriate for you. You can also go through the ranking chart (under "Our Services" in the box to side of the page) to look for reputable companies to help you with same.

Good luck to you


lrhall41

Submitted by Morningstar on Fri, 02/23/2007 - 08:52

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Lender assess a debt to income ratio to see what risk you are for giving you credit.Most ask about credit card because it is the most common.Your tax debt and the navy debt you have sends a large red flag to a potential creditor. One you have spoken with a counselor,come visit me in the credit repair section so we can evaluate credit reports and get the mess sorted out. :D


lrhall41

Submitted by cajunbulldog on Fri, 02/23/2007 - 09:22

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The problem is...my credit card debt isn't that large. It's just that I'm living outside my means because I took a lower paying job while I was stuck in a lease. So, I've been living outside my means for a while and have dug myself into a whole. It's my every living expenses that are breaking me down. My monthly bills, just for the basics-rent, gas, electric, water, car payment-are about $1200 more than what I bring home every month. There's no way I can reduce my credit card debt with living expenses like that. And I've tried and tried to get out of my lease without owing thousands of dollars-to no avail.

No budget counseling or credit card management training, or negotiating lower interest rates is going to change my living expenses that I've already accumulated. I'm 2 months behind on my most of my bills and already had a couple things shut off. It's not the credit cards that are the problem. I've already made arrangements to change my living situation so I can stop digging a deeper hole, but I need to do something to recover from the whole that's already been dug, but it seems I can't get any help cuz it's not credit card debt.


lrhall41

Submitted by on Fri, 02/23/2007 - 13:27

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Creditors look into many things in your credit report before extending credit. You need to have the debts shown "paid" and prove your credit worthiness. They want to make sure that after extending credit, you do not pose to be a risk to their finance. Go through some credit repair tips and fix your credit ratings. Then, you will be able to make better deals with all lenders with whom you are shopping for credit.


lrhall41

Submitted by Flying Cats on Fri, 02/23/2007 - 13:29

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Fedupinpa,
Your car will raise scores over time.Try to look into adding some type of credit cards to it. Use them about once a month and pay in full. Get a loan from your local bank for a small amount.Keep it long enough to report and pay in full. Remember always pay on time,lates can pull a score down close to 50 points,collections sometimes close to 100. I was where you were in early 90's.Now I have more credit than I want. Another good tip I follow is keep a close eye on your credit report and dispute anything that is wrong. I have been giving equifax so much hell they are giving me boatloads of free reports so I stay out of their hair :lol: Find my post in this section about backdoor to credit report and pull your report.


lrhall41

Submitted by cajunbulldog on Fri, 02/23/2007 - 18:25

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