Hidden Credit Traps

Credit Tip...

While it may not show on any form and lenders are loathe to admit it, anyone who jumps on the bandwagon and cancels their home phone (land line) in favor of the “cellular revolution” may be harming their credit.

Having a home phone with a specific geographical location is considered a stability factor by most lenders of all sorts. Sales people for the lenders who are trying to get you to fill out an application likely will not tell you that it matters, but, when your application is reviewed it does factor in.

With a fixed location the lender knows where to contact you. They feel more secure if they were to have to collect or repossess something.

If you cannot afford a home phone, then you might have trouble paying whatever debt (loan payment) you are applying for. If all you have is a cell phone, you can block the collection calls and live anywhere! Loan and repo companies are not comfortable without someplace to reach you reliably .

This quiet, little known, almost hidden, and undiscussed factor can have a negative impact on your credit ratings, scores, and availability of existing credit.

You get a letter telling you your interest rate has gone up or, pay your balance down or, dropping your available credit line or, canceling your account altogether, and you haven't done anything wrong! You don't understand and they will not tell you why. You hear things like “review” and “policy” etc.

You didn't know that going completely wireless (locationless) with your home phone could hurt you!

So before you jump into all the flashy cell offers, think and research what the repercussions may be.