We asked members of the BuzzFeed Community to share their worst credit mistakes because — real talk — credit can be confusing. It's not always intuitive, and very few schools teach even the basics of credit management. For a lot of people, experience is the only — incredibly difficult! — teacher.
Here's what 11 people wish they hadn't had to learn about credit the hard way:
1. Beware the dangers of cosigning a loan.
"I cosigned for my ex’s car only so we could use my car as a trade-in. Newsflash: He’s paid every payment late for years and is about to get his car repoed... My score went from in the mid-600s to the low 500s."
2. Credit is no substitute for savings.
"Got into a bit of credit card debt with the thought of 'instead of saving $100 a month for this vacation, I’ll just put it on my credit card and pay $100 a month on it.' It kind of snowballed a bit from there. I finally paid it off (a year later!), and now my credit card lives in a box in my bedroom."
3. Always. Read. The. Fine. Print.
"Financing something and NOT reading the fine print! We financed our golden retriever with the goal of training her to be my service dog. We didn’t read close enough to realize that $100 of our $105 monthly payment is just interest!!! We have learned the hard way how fast credit card debt can add up."
4. Small down payments can be a big headache.
"Bought a home with less than perfect credit and only 3% down. Our mortgage insurance is $150/month and for the life of the loan. I can’t wait to be able to refinance this loan."
5. Don't wait to resolve medical bills until it's too late...
"When I was about 19, I needed physical therapy. Did my sessions, yada yada. Even though we gave them my insurance card, I still got a bill. Huh. Called [and] they said they would take care of it. This cycle continues for about two more years. Getting bills, calling, it will be taken care of, etc. Well, eventually it got sent to a debt collector. We call, and the place I received my therapy from is claiming they had no record of my insurance, so that’s why I got the bill, and it was too late to be resolved. Of course, we had no proof to say otherwise. We paid it, but the kicker is that even though it was my parents' insurance, it was in my name as an adult. So it impacted my previously nonexistent credit. MORAL IS: Make sure all billings are resolved quickly. And ENSURE that they are actually taken care of. Years later, and some credit cards still deny me..."
6. Seriously, stay on top of your medical bills.
"I didn't realize my old doctor's office from another state had been trying to get in touch with me for a $250 bill I thought I paid...until six years later. They'd called collections who somehow had no contact info for me. So I never knew until I analyzed a credit report for the first time."
7. Again, for the people in the back: Pay your medical bills on time.
"I ignored a $50 outstanding bill I received after an urgent care visit. I blew it off thinking, 'I paid my copay. Why the hell am I getting a bill?' And two years later, I realized it had brought my credit score down to the low end of the 'fair' range, when previously it had been on the high end of the 'good' range. I paid it off, but I’m still trying to get my score back to where it was, though I am back in the 'good' range. I’ll never ignore a medical bill again!"
8. Don't put a down payment on a credit card.
"I bought a car without cash and put the down payment on my credit card instead. It has been such a headache trying to pay off to huge loans. I should have waited until I had more cash for a real down payment. My credit score went down at least 100 points."
9. Check your accounts regularly to avoid nasty surprises.
"Sooo make sure that you always check your credit card accounts, even though it’s paid off and you haven’t used it recently! Turns out Geek Squad is a yearly charge even though the laptop you got it for is long dead. My bill was long overdue, paid double what the charge was to pay it off, and they closed the account while I was completely oblivious, thinking it was paid off, knowing I hadn’t personally charged anything to it... Now a nice stain on my credit repot for the next seven years... Always check!"
10. Loan deferment is not a "set it and forget it" situation.
"Not consolidating my student loans. Then once I deferred them for a year because I was laid off. Every month I'd get a bill with zero due, so I stopped opening them. Then one day I got a pink one, which meant I was now three months late on about 10 separate loans instead of one... I didn't realize it had been a year. So I had 10 penalties on my credit, and it took about four years for that to roll off. Dumb move!!"
11. Credit utilization ratios, amirite?
"I used to use my credit card up to the limit. Even though you are technically allowed to spend that much, it significantly dropped my score. Now, I only spend 30% of my limit, which isn’t a whole lot, but it boosted my score and helped me build credit. It’s now a few months later, and I’ve been approved on three different credit checks!"