For many people, the economic difficulties of the past few years have been a big wake-up call. When the recent recession was at its bleakest, many people in Ohio and around the country found themselves saddled with onerous credit card debt and a poor credit score.
A bad credit score can affect the ability to open a checking account in Ohio, find an apartment to rent, get a new car and in some cases it can even affect the ability to be seriously considered for a certain job. For those with insurmountable debt, bad credit can be an issue that seems to compound financial problems.
Let's face it, in some ways we live in a plastic world. Many people in Cincinnati rely upon credit cards and other forms of credit to make purchases. Buying a home, or obtaining secured credit for a car, is more difficult for a person with no credit history at all. This blog has previously discussed that a person who has filed for bankruptcy and who work's to improve his or her credit rating may be able to qualify for a new mortgage in a matter of years with hard work.
Several years ago, an Ohio State student asked her lawmaker if the federal government could do something about how medical debts are recorded in a credit report. The woman suffered from fatigue and her doctor ordered a sleep study. Apparently, her medical insurance later refused to cover the medical bill, and the Ohio resident was saddled with bad credit from the medical debt.
Three United States Senators, including Ohio Senator Sherrod Brown urged the Consumer Financial Protection Bureau to look into medical debt collection and reporting practices. The Senators sent a letter to CFPB Director Richard Cordray earlier this month asking the federal agency to address issues in medical debt collection practices and how medical debt issues are scored on consumer credit reports.
Typically, sources say that medical providers are reluctant to report medical debt issues to the major credit reporting agencies. But many people in Ohio who decide to file for bankruptcy have been pushed over the line to insolvency due to medical debt. Unexpected injuries, or long medical battles, can often result in large medical debts, even among those who may be insured, depending upon individual circumstances.
In the last post, this blog began a discussion of a unique problem in the credit reporting system in this country that can cause devastating affects upon a consumer in our plastic driven society-the problem involves mixed-file credit histories, where a consumer's file is erroneously merged with another by the credit reporting agencies.
Recently, the Columbus Dispatch reported its findings in a lengthy investigation into the difficulties consumers can experience from errors that may be contained in their credit reports. Ohio residents who are contemplating bankruptcy may think about what effect a bankruptcy may have on a credit score, although most financially distressed consumers may already be experiencing credit score issues.
Issues surrounding bad credit have always concerned families, and individuals, across Ohio. The credit reporting system can seem like an enigma for many Cincinnati residents. Part of the difficulty for consumers is the fact that, while people are aware that credit reporting companies exist to track credit history and compute credit scores, the issue usually only becomes concrete when a consumer decides to buy a car, a home or enter some transaction where a credit history is required.
Yesterday, this blog began a discussion on credit card use and credit scores. The average consumer in the United States that uses some form of payment card, such as credit cards, debit cards and prepaid cards holds a total of 3.7 cards, according to the Federal Reserve. It only stands to reason that some consumers have a higher than average number of open credit card accounts. The higher the number of cards a consumer holds may allow for some flexibility in managing debt if a crisis arises.