Robbing Peter to Pay Paul…with Bad Credit

I’m not really sure where the phrase came from, but it’s one I’ve referred to quite often. Many of you reading this post may be thinking…”hmmm I don’t think I fit into this category, so I’ll just ignore this one.” That would be problem #1. If you know what the title implies, then you might want to think twice about skipping this article.

When you have bad credit, you have very few options when it comes to borrowing money. If you go to a bank, you run the risk of getting rejected and further ruining your credit. If you go to a payday loan store, you run the risk of being seen by people you know. I, personally, would rather keep my personal finances separate from personal friends, but that’s just me.

There is always a way out of a bad situation, even when your personal forecast calls for even cloudier days ahead. It’s not easy, but it can be done.

First, don’t follow the rob Peter to pay Paul method. This will only end up getting you deeper and deeper in debt. (As the saying implies, you will owe Peter even if you do pay Paul. So, what’s the point?) Shying away from this approach is especially important when you have bad credit because this could lead to bills not being paid on time, which could then lead to more negative marks on your credit report…and well, I think you get the point.

What’s more important is for you to identify where you stand financially, right now. That’s something only you can answer. You know what goals you want to reach. You also know how far off or close to those goals you are. As my father always says, “if you don’t understand where you are, then how will you know how to get where you’re going.”

Make Arrangements! Say you’re in a tight spot and you just cannot figure out a way to pay the bills. I know it sucks, but you can make arrangements. It is a much better idea to do that, instead of messing up your credit even more. For those of you saying to yourself, ‘my credit can’t get any worse,’ think again! Your credit status includes information like the amount of debt you have and your payment history. The last thing you need is for a company you’re dealing with to submit negative information to the credit bureaus. That doesn’t go away overnight, no matter how quickly you resolve the issue.

Pay on Time! If you have a mortgage, always pay it first and pay it on time. Make that a habit and don’t break it. For reasons I won’t get into, mortgage payments carry a lot of weight. I hate to do this…but if for some reason, you are abducted by a space alien for two weeks and lose your job as a result, then by all means call your lender and see if something can be worked out. I don’t think the story will work, but at least make the phone call.

Get Help! As I’ve mentioned in previous posts, I have gotten help before and quite frankly I am not afraid or ashamed to do it again. In the past, when all else failed, I turned to online lending companies for help. Again, the key here is not to bite off more than you can chew. Figure out how much you need, then compare it to how much you can pay back. The really good thing about them is that I know for a fact they will work with you. And, don’t worry about your credit. They accept all kinds.

All I’m saying is don’t keep robbing Peter to pay Paul if you don’t have to. There are ways to get out of the financial rut you’re in. Just dig in your heels and get going on a path to financial sanity.