Many people do not realize that they have bad credit debt until things get really bad and out of control. But in most cases there are sure signs that show you are facing bad credit and you need to act on it before your finances collapse and it will get harder to repair your credit rating.
You do have to sometimes stop and analyze your finances, face your income and expenditure details and set up a plan and budget tho handle credit better. The end of he year and beginning of the new year is the best time to face your bad credit and make a plan on how to improve it.
No. 1 sign that you are facing bad credit debt
You are struggling to pay your bills and are left with little or no money in the end of the month. You are missing payments or being late with credit card fees and monthly subscriptions.
No. 2 sign that you are facing bad credit debt
Any kind of unexpected bill is making it very difficult to live on and it crashes your whole budget for the month. You cannot afford holidays or going out anymore.
No. 3 sign that you are facing bad credit debt
You are living of your overdraft. You stay close to your overdraft limit and have not decreased your overdraft for a while. Lenders will see that as a sign that you are in some kind of financial trouble, therefore will not be willing to lend you money.
No. 4 sign that you are facing bad credit debt
You are paying loads of money on your accounts in late charges, overdraft fees, money that you could spend on much more useful things otherwise. You get charged a higher interest on your credit card than before and your overdraft limit has been decreased by your bank. Alternatively your credit card company reduces your credit limit.
No. 5 sign that you are facing bad credit debt
You are using your credit card on everyday purchases, instead of paying for larger bills and paying it back in a few months’ time. You are using credit to go on holidays, pay for your bills or expenses and have no money left to pay Christmas presents. You take on a short term loan to pay for your travel expenses.
If you are facing one of the situations above, you are definitely facing bad credit debt. There are loads of resources on relevant pages explaining how you can improve your credit situation.