Credit, good or bad, is a part of functioning in today’s society. When you rent an apartment, you establish credit. When you buy a house, that certainly affects your credit. Credit cards, student loans, home equity loans, department store credit and bank accounts are all influenced by your credit rating.

This means that the effects of negative credit are far-reaching and can make life quite difficult.

Here are some of the various ways negative credit can affect your life:

When you go to purchase a car, chances are you’re going to want a loan. Whether it is a used car or a new one, the interest rate you qualify for can mean the difference between being able to finance the car you want and your second or even third choice. A new car loan can range anywhere from the promotional 1% finance rate – pretty darn good – all the way to 10%. Used car loans generally range from 5% to upwards of 20% depending on your credit. This difference in percentage rates can equate to more than $100 a month depending on the cost of the car.

Did you know that if you have bad credit you can be denied an apartment? When you rent an apartment, your credit will be checked and you can bet that if you have bad credit, you’re going to have a tough time finding a place to live.

Did you know you can lose a job because of bad credit? Yep, many employers obtain credit reports on their job applicants. This is entirely legal. Why would they get your credit report? Many employers want to know that their employees are financially secure. This demonstrates not only an ability to behave responsibly, but it also tells your employer that you are likely someone who can be trusted. If you’re in bad financial straits and owe money to many creditors, you could be stressed and distracted, and you may even be more likely to steal from the company. Now this is of course a huge generalization, but it is one that companies are legally entitled to make.

Your credit rate actually affects your insurance premiums, too. Both home owner’s insurance and automobile insurance rates are a direct reflection of your credit score. Financially, bad credit can mean an inability to get a credit card, a loan or a home mortgage. If you are given credit, chances are there will be more hoops to jump through, more fees, and your credit will come at a higher interest rate. In short, it will cost you more to borrow money.

While bad credit can have a negative affect on your finances and on your life, it is reversible. The advice if you have bad credit is to develop a budget and pay off your credit cards. And consider getting a secured credit card to rebuild your credit score and repair your credit history.