Loans When Blacklisted
You’re probably well aware of the consequences of having a poor credit score and struggling to find loans when Blacklisted.
When it comes to important life milestones like purchasing a home, financing a car, or even establishing a credit card, lenders are considerably more cautious to view you as a dependable candidate if you have a poor credit history.
Nevertheless if you are accepted, expect sky-high premiums and interest rates, making your financial situation even more difficult.
What you may not understand is that a low credit score has ramifications beyond your bank account.
When you’re dealing with a string of financial failures, the repercussions of a poor credit score might start to weigh on your mind and body.
A bad credit score may have a negative impact on your mental health, personal connections, and entire lifestyle.
If you believe your financial position is affecting your mental and physical health, this info-graphic explains some healthy habits and acts of self-care you can include into your daily routine to help counteract the negative impacts of financial stress.
Development of Stress
In 2020, over two-thirds of individuals said money is a major cause of stress in their lives.
This isn’t surprising, given how your credit score affects your ability to access a variety of key lifestyle possibilities.
In addition, according to a Credit Sesame research from 2020, 82 percent of individuals feel negative stress as a result of credit card debt alone.
Financial stress can be caused by a variety of factors, particularly when credit card debt is considerable.
Many people will lose their ability to get a credit card, which they may have relied on to get by.
Others find it difficult to qualify for a house loan or a vehicle loan because of their credit card debt.
It may also mean not being able to pay for a child’s college education, put money down for retirement, or repay student debts.
Regret
Most of us can recall a moment when we regretted a purchase or financial choice, according to a 2019 research.
Too much credit card debt was also named as the number one financial regret by 16 percent of South Africans.
As a result of their financial burdens, 13 percent of working South Africans put off saving money.
It’s easy to regret not having enough savings when an unforeseen incident or emergency arises and you don’t have the money to cover it.
In many cases, people put off facing the problem because they feel scared or overwhelmed by it. Examples include the amount of debt they owe, the decline in credit score, or a lack of saving.
Unfortunately, many people have found themselves in a similar situation.
Anger
Some people’s low credit ratings cause them to feel depressed, while others become angry.
According to a Credit Sesame research from 2020, 30 percent of people with bad credit are upset about it.
Individuals with poor credit were unable to rent the apartment they wanted in 28 percent of cases, qualify for an auto loan in 49 percent of cases, lease a cell phone in 21.6 percent of cases, and live with their parents for longer than they would have liked in 19 percent of cases, according to the study.
Anger and resentment are natural reactions to bad credit because of the terrible conditions it typically creates.
Work performance
Adults’ financial problems are expected to negatively influence their work performance by 19 percent in 2020.
Poor credit may also cause sleep deprivation, worry, and anxiety, which can lead to distraction and inability to concentrate at work.
7 percent of persons with negative credit were unable to obtain a job in 2019, according to a Credit Sesame research.
This is most likely owing to the fact that employers may want to evaluate your credit history as part of their background checks.
Some recruiting managers may be reluctant to hire you because of your lack of financial responsibility, which they will correlate with your inability to fulfill standards and expectations at work.
Relationships In Disarray
Personal connections can be strained while dealing with the repercussions of a low credit score and an unpredictable financial status.
One study from the year 2019 found that 36.1% of divorced individuals blamed their relationship’s stress on financial difficulties.
As a result of credit card debt, 8 percent of respondents in a 2019 research broke up with or divorced their partner.
This might lead to emotions of anger or guilt towards your spouse if they brought their low credit score or huge amounts of debt into the relationship.
The same may be said if you have a low credit score and financially dependent relatives, which could lead to negative sentiments against them in order to pay off your debt.
Fatigue
For the fact that you can’t find loans when blacklisted in South Africa, that alone can leave you exhausted.
Many individuals experience tiredness and sleep loss as a result of their poor credit health.
According to a conducted survey from 2020, 48 percent of South Africans are unable to sleep at night owing to financial constraints.
The inability to pay off credit card debt was the single reason of sleep loss for 13% of those polled.
Furthermore, 20% of South Africans claimed they felt physically unwell at least once a month in 2019 as a result of their debt.
As a result of working longer hours to make ends meet, those who are suffering to pay bills, maintain their vehicles and houses, or adequately support their children’s education may also have a reduced amount of time for sleep and rest.
Financial worries can keep people up at night even though they are physically fatigued. This prevents people from obtaining the quality sleep they need.
Anxiety
You can borrow huge sums of money in an emergency if you have a good credit score.
You’ll be able to pay for unforeseen health emergencies, such as an ambulance journey or surgery.
This is less likely to be the case if you have bad credit.
African consumers, according to a 2020 survey, are most concerned about the expense of healthcare, with 79 percent of respondents expressing anxiety about it.
To save money, 58 percent of individuals indicated they would utilize a ride-sharing service to travel to the hospital instead of an ambulance, as reported in Credit Sesame’s 2020 study.
Having peace of mind in all parts of your life is dependent on keeping your health and being able to afford the expenditures connected with it.
Anxiety over high healthcare expenditures and whether or not you have a good credit score can be a severe side effect.
Shame and Guilt
Uncommonly addressed is the shame and guilt that bad credit health or debt may cause. In a 2020 survey of persons with low credit, 46 percent admitted to feeling guilty about it.
Individuals with credit card and personal loan debt blamed themselves for 49 percent of their debt, according to a 2019 research.
“How could I have allowed things to go this bad?
I asked myself, “Why did I let myself get into this situation?”
Instability in financial matters is accompanied by chronic guilt emotions.
Aside from that, the way society and culture evaluate other people’s degree of success is intimately related to how they look to be wealthy or materialistic.
People who owe a lot of money often feel humiliated about it, feeling that they don’t measure up to their friends who don’t have any debt.
A vicious cycle of debt accrual and credit score degradation can result in an attempt to project a false image of prosperity through expensive clothes, flashy vehicles, and expensive evenings out—all in an effort to keep up appearances.
Unfortunately, this just adds to their sense of humiliation.
Depression
Anyone who has ever had a poor credit score knows how depressing it can be.
Just that thought of knowing that you will not qualify for loans when blacklisted, that can’t put you in bed 24hrs.
American people stated that financial concern contributed to depression on a monthly basis in 2020, with 31 percent reporting this.
It’s not unexpected that debt or a low credit score may have a negative impact on one’s mental health.
This might also be due to a lack of understanding about how to improve their credit score.
According to a 2020 study, 16 percent of respondents with bad credit are perplexed by their credit score.
When asked how their poor credit score has affected their lives, 24 percent of those with bad credit claimed they’ve never learned how to manage the financial system properly in their lifetime.
Self-esteem
No matter how much we may dislike it, our culture has trained us to equate our self-worth with our monetary balance.
The failure to appropriately preserve money and protect themselves from unanticipated financial difficulties was discovered in a 2019 research of debt-ridden individuals.
In the same survey, 51 percent of respondents who were in debt felt that they had not maximized their potential.
A person’s poor credit health or debt can cause them to lose confidence and self-esteem, making them hesitant about taking the measures necessary to restore their credit and establish a more stable financial foundation.
This can make it impossible for a person to ever try to develop better credit practices, which only serves to prolong their poor self-esteem:
In a 2020 poll, 16 percent of South Africans said they were concerned about their financial situation.
It’s hardly surprising that 9 percent of respondents lost their house and 7 percent were unable to find a job owing to credit card debt, according to another 2019 survey.
