Example 1: Financing an automobile
If you are making payments on a typical auto loan, you are probably paying between $5,000 and $9,000 more in interest just for having bad credit. See the chart below.
| Credit Status |
Rate |
Payment |
Cost of Bad Credit |
| Perfect |
10% |
$ 424.94 |
$ 0 |
| Mildly Damaged |
14% |
$ 465.37 |
$ 4,722.54 |
| Damaged |
20% |
$ 529.88 |
$ 8,593.30 |
Example 2: Mortgage on a Home
Bad credit in auto financing can really hurt, but it is nothing compared to the cost of bad credit when a home is involved. A typical home can cost between $50,000 and $130,000 more in interest if you are buying the home with bad credit. See the chart below.
| Credit Status |
Rate |
Payment |
Cost of Bad Credit |
| Perfect |
7% |
$ 655.30 |
$ 0 |
| Mildly Damaged |
9% |
$ 804.62 |
$ 50,155.24 |
| Damaged |
12% |
$ 1,028.61 |
$ 130,791.63 |
How quickly can I pay off my debts with good credit?
The impact of a higher rate on a $500 balance, if you make a minimum payment of $10 per month:
| Interest Rate |
16% |
19% |
21% |
23% |
| Number months to pay off |
83 |
94 |
120 |
168 |
| Interest paid over time |
$ 329.42 |
$ 431.08 |
$ 698.50 |
$ 1,174.36 |
Conclusion
These are powerful, yet painful, examples just how much banks and creditors are making
off of you. Why pay more than you need to?
Invest in repairing your credit. It's one of the best things you can do.
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10.04.2004
CCR teams with two major mortgage companies and one bank to provide credit repair service...
09.28.2004
CCR opens New Jersey office...
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