Easy Credit can trap you in debt by tempting you to spend more money than you can afford to repay. High interest rates, fees, and penalties can quickly accumulate, making it difficult to pay off the debt.
This can lead to a cycle of borrowing and repaying, which can result in long-term financial struggles and damage to your credit score.
A friend had some medical bills she did not pay right away. She also was slow at paying her credit card and had several thirty day late credit card payments. Her Credit Score hit 550. The Credit score range is 450 to 850. Anything below 700 is below average. A 550 score will keep you from getting any kind of loan except for maybe a very high interest car loan with a significant down payment.
Well that is what she did. She saved up $5000 and bought a $21,000 van that was $3000 over book value. Her interest rate was 18% and the loan had a early pay off penalty. In addition she was required to buy a service warranty for $3000 that was added to the loan.
Anyway she ended up paying $6,000 more than book value for a Dodge Grand Caravan. A year after she bought it she tried to get out of the loan and sell it back. They would let her out of the loan and take the van back if she came up with $6000. This was after making twelve payments of $1000 per month. She is Credit Trapped.