America is addicted to debt. Just call us the credit nation, from the highest levels of government all the way down to Main Street USA. America and Americans are obsessed with credit and rely on debt every day. Even as the nation and its consumers struggle under record debt levels, we continue to rack up more.
Like it or not, we need credit. As we have established during and since the global financial meltdown of 2008, credit keeps the wheels of the global money machine well greased. Concepts, such as buying a home, starting a business, or buying an investment property often could not become realities without some form of credit. In fact, utility companies, banks, landlords and even employers often require credit checks before extending services or employment. Consider the following statistics:
- As reported by the Federal Reserve Board (FRB), the size of total U.S.consumer debt grew nearly five times in size from $824 billion in 1990 to nearly $2.2 trillion in 2005.
- According to Experian, without factoring in mortgages, in 2008 the average American held over $16,635 in debt.
- According to ComScore, in 2008 55% of Americans maintained a running balance on their credit card accounts.
- According to Visa and MasterCard, in 2006 alone there were 984 million bank-issued Visa and MasterCard credit and debit card accounts in the United States.
- Mail Monitor, a credit card direct mail tracking service, reports that roughly 4.2 billion credit card offers were made to U.S. households in 2008.
- An online poll conducted by CardTrak.com reports that the average rate for bank credit cards reached a whopping 19% in March 2007, whereas the average rate in 2003 was 16.5%.
Watch: Prioritizing Debt
Credit and its associated debts are a part of our reality, and will continue to be for the foreseeable future, and it is up to each individual consumer to not let credit ruin them. Unfortunately for many, it already has. The level of consumer debt has grown exponentially in the U.S., where tens of millions of credit consumers find themselves overwhelmed by their personal debts.
If you find yourself in a credit or debt bind, keep reading. This tutorial will provide an overview of credit and debt management concepts that every consumer should know about so they know how to live with credit.
The Table of Contents
- 1Watch: Prioritizing Debt
- 2Credit Reports And Scores
- 3Credit Bureaus
- 4Credit Scoring
- 5Credit Score Components
- 6Building Credit From Scratch
- 7Consider Getting a Cosigner
- 8Start With a Store Credit Card
- 9Your Last Resort: A Secured Card
- 10Repairing Credit
- 11Repairing Credit After Identity Theft
- 12Review Your Reports Regularly
- 13Credit Cards
- 14How to Get Into Trouble With Credit
- 15Other Credit Traps to Avoid
- 16College Students and Credit
- 17Debt Collection And Bankruptcy
- 18Negotiating With Debt Collectors
- 19The Fair Debt Collection Practices Act
- 20Bankruptcy Testing
- 21The Bankruptcy Act's Effectiveness
- 22Credit Counseling
- 23Finding a Reputable Credit Counseling Firm
- 24What to Expect From Credit Counseling
- 25Credit And Relationships
- 26Credit and Divorce