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Credit and Debt Management

Credit is the ability to borrow money or access goods or services with the promise that you’ll repay it in the future, often with interest. It can be a useful tool, but it can also get you into trouble. Your creditworthiness can affect your ability to finish your education, buy a car or house, or even get a job since a good repayment history demonstrates responsibility, a trait most employers seek. The goal of good debt management is to show those who inquire about your credit that you are responsible and in control of your spending. 

What is a credit report?

A credit report is an organized list of the information related to your credit activity. Credit reports may include: 

  • To total amount of each loan you have borrowed or the credit limit for each credit card 
  • How often you paid your credit or loan payment on time, and the amount you paid 
  • Any missed or late payments as well as any bad debts 

It is important to review your credit report at least once a year to ensure that the information is accurate. If you find a mistake, you should contact the credit reporting agency that provided the report containing the error. The major credit reporting companies are: 

Where to obtain a free credit report?

What is a credit score?

A credit score is a prediction of your credit behavior, such as how likely you are to pay a loan back on time, based on information from your credit report. Click here to learn more about credit scores.  

How to maintain a good credit score?

Usually, a higher credit score makes it easier to qualify for a loan and may result in a better interest rate or loan terms. There are some steps you can take to make sure you maintain a good credit score. You can:

  • Pay your bills on time.
  • Keep your credit card balance(s) low or at zero.
  • Check your credit report regularly.
  • Only apply for credit you need.
  • Contact your lender or creditor if you are experiencing difficulties and fear that you might fall behind on your payments. 

Ten Warning Signs of Too Much Debt

If you are wondering whether you have too much debt, then there’s a good change that you do. Having too much debt can lead to other financial problems, such as not being able to save money for the future, missing bill payments, or having to borrow more money just to stay afloat.  

Here are a few signs that you may have more debt than you can handle: 

  • You've drained your savings trying to pay off your debt.
  • You only make the minimum payment on your credit cards each month.
  • You pay bills late because you don't have any money.
  • You have at least one credit card that is near, at or over the credit limit.
  • You continue to make more purchases on your credit card(s) while trying to pay it off.
  • You use cash advances from your credit cards to pay other bills.
  • You have been denied credit.
  • You don't know how much total debt you have.
  • Your finances cause you to lose sleep at night.
  • You don’t answer the phone because it might be a bill collector.

Debt Management Resources

If you are overwhelmed with debt, you are not alone. There are resources that can help you overcome your debt burden and help to move toward financial free. You can contact your lender to ask about repayment options, consider debt counseling or consolidation, or contact the National Foundation for Credit Counseling.  

For other online resources you can visit: 


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