With this portion of the website, we have laid out the costs associated with having excellent credit, fair credit, and bad credit. Although it is easy for us to calculate, it is difficult to look at the amount of money wasted due to bad credit. Please note, as interest rates rise, the numbers listed below go up.

Home Mortgage

The numbers below are based upon having an outstanding mortgage of $225,000, with a LTV (Loan to Value) of 80 – 85%. As you can see, poor credit will cost you tens of thousands of dollars over time. These numbers are based on rate and payment, mortgage fees and points not included.

credit score rate monthly payment cost of bad credit 30 year cost
700 – 850 5.50% $1031.25 $0 $0
620 – 699 7% $1312.50 $281.25 $101,250.00
500 – 619 8.75% $1770.08 $738.83 $265,978,80

Automobile Financing

Let’s take a look at the financing of an automobile. Low automobile payments are extremely important considering the inflated gas prices. The numbers below are based upon a loan amount of $15,000 with a 60 month term.

Having a good car loan is very important, especially because an automobile is a depreciating asset. Being “upside down” or owing more money than the car is worth is EXTREMELY costly and upsetting.

credit score rate monthly payment monthly cost of bad credit total cost of bad
credit over 5 years
700 – 850 5.50% $286.52 $0 $0
620 – 699 10% $318.71 $32.19 $1931.40
500 – 619 15% $356.83 $70.31 $4,218.60

The examples above show the costs of making a major purchase with less than perfect credit. A couple of percentage points in interest can be the difference between barely surviving and living comfortable. We have the solution to living comfortable.

Credit Card Payments

Below is an illustration consisting of $8,000 in credit card debt. We have included a simulated commitment of $175.00 per month. Please understand the difficult position you are putting yourself in, when dealing with fair and poor credit.

credit score rate monthly payment total cost of bad credit extra time required
to pay debt
700 – 850 8% $175 $0 None
620 – 699 15% $175 $5070.00 29 Months
500 – 619 21% $175 Infinity Infinity

Without the proper budget management, you may find yourself in a hole of debt. Digging yourself out while paying outrageous interest rates will be difficult, if not impossible. Our company will provide a helping hand, and pull you from the depths of debt and into the warmth of financial security.

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