Everyone knows that a credit score can directly affect your financial well being, but not many people think about how a good (or inversely, a bad) credit score can actually affect your physical and emotional well being, as well bong da truc tiep . This might sound a little strange at first, but remember that nothing about health or the human body stands by itself: it’s all connected.
What’s one of the biggest killers out there? Stress. Stress increases the chances of high blood pressure, heart attack, stroke, hyper-anxiety, and a large array of other illnesses or conditions. Stress can make anything worse on the human body, not to mention the faster aging.
So how does a credit score relate at all to stress? Well if you’re struggling with a bad credit score, you probably already know that answer. But the number one listed cause of stress from most Americans is finances. Whether it is credit cards, a mortgage, student loans, or simply not making enough income, the money strain is number one on most people’s minds.
Finances are going to be more stressful with a bad credit score than with a good one. A very good credit score can make a lot of normal money concerns disappear. For one, a person with a good credit doesn’t have to worry about finding a credit card with a good rate. The banks will come to you with the best rates possible to try and win your business.
Also, you’re going to get a better home loan, which will save you thousands of dollars in the long run, and make pay check to pay check budgeting much easier in the short term, as well. When you have more money, you can buy healthier foods, or that gym membership you just never could quite afford.
During the boom years of the real estate market, banks could not hand out subprime mortgages quickly enough to meet demand. This demand, though, was from a segment of the population that, until the advent of no money down, interest only, adjustable rate mortgages had been largely locked out of mortgage borrowing. But it may have been the general decline in the creditworthiness of Americans that prompted banks to lower lending guidelines so precipitously.
A good question that should be investigated is whether or not the credit scoring guidelines changed at all during the period when large numbers of subprime loans were originated. However, even a study of this sort may not shine much light on the situation. As we know from the bond rating agencies’ failure to acknowledge the risk in the subprime loans, it is clear that manipulating credit ratings or scores is surprisingly easy.
But one thing that is known for sure is that the savings rate of Americans has been dropping over the past decade and even longer. Without substantial savings, people are unable to react to a short-term downturn in their financial situations, and can not begin to improve their lives in any significant way. In times of hardship, they turn to credit cards to finance their lives or are forced to cut down drastically in their standard of living to avoid falling into bankruptcy.
This type of cycle is incredibly difficult to break for many people, who fall further into debt at every little hardship and spend the rest of their lives trying to climb out of the hole. The prevalence of subprime mortgage loans requiring little or no money down allowed people who may have had little or no assets throughout their lives to purchase homes with no financial investment. They were not required to save up 10 or 20% as a down payment, so they had far less emotional attachment to the property, and did not have to alter their financial habits.
If a borrower had a history of late credit card or car loan payments, and was then offered a house loan with no money down regardless of their credit score, why should they care if the mortgage payment doubles in a few years and they can no longer afford it? The banks should have recognized that these borrower have a history of paying late and not saving for an emergency fund, but they were offered a seemingly great mortgage loan anyway.
For these homeowners who had nothing, were offered it all, and then had it all taken away again, there is always the good chance that they will get away from the foreclosure house with no negative consequences, besides more damage to their already meaningless credit score. And a bad credit history did not stop banks from lending hundreds of thousands of dollars in the past with little more than a signature, so the former homeowners can probably just wait a few years until credit conditions ease and apply for a new mortgage.
It is clear that not every homeowner to obtained a subprime loan was a poor credit risk or taking advantage of the loose lending. However, these types of borrowers, who had previously been turned down for loans due to poor credit and no savings, were given the subprimes. Whether they were just somewhat ignorant of the entire system or were trying to get in on the boom by buying a dozen houses and flipping them, the banks obviously overlooked past poor payment histories, to their own detriment.