Although increased income is a major financial goal of most consumers, your future is also dependent upon having good credit. Many aspects of the American economy rest on consumer credit. The largest purchase most consumers will make in their lifetime---their first home---is only possible if both income level and creditworthiness are in tact. With the recent changes to the housing market, lenders will scrutinize a consumer’s ability to pay and manage debt.

With that in mind, developing bad credit and a low credit score is a gateway to dismal credit options in the future. Those who cannot manage their credit wisely can look forward to the following:

· Higher interest rates: It will cost you more to borrow, finance, or make credit purchases. The interest rates you can obtain can make purchases with credit virtually unreasonable, which can also bar you from redeveloping credit.

· Lower credit limits: Coupled with your income level, you may not qualify for the amount of credit you actually need to finance big-ticket items, a mortgage amount equal to your ideal home selling price, or you will have minimal limits on credit or retail cards.

· Additional terms and fees: For revolving credit, you may have to pay “annual” or “participation” fees for credit or retail cards; these are essentially one-time fees for the privilege of a creditor extending credit to what they determine to be high-risk consumers. With installment credit, you may be expected to put a larger down payment just to be considered for loans. For service credit, you may be required to pay a deposit to open an account.

· Approval for high-risk credit: Though coupled with your income and down payment amount, you may qualify for hybrid, adjustable-rate, or split-loan (i.e.: 80/20) mortgages when buying a home.

· Denial of credit: Your credit application may be declined altogether; you would not even be given the limited opportunity for poor credit terms and interest rates.

Overall, creditors offer better options to those who demonstrate they can manage debt, and high-interest, conditional-termed credit to those who don’t know how. If the only credit you are offered is similar to that described above, it is a clear indicator that you are viewed as a credit risk, have a history of poor credit decision making, or a low credit score.

Additionally, should you be approved for credit with any of the limited conditions mentioned, and have already developed habits of credit mismanagement (see “Developing Bad Credit” and “Signs of Credit Mismanagement”), you could escalate to levels of excessive debt, as you have been shouldered with excessive interest rates or risky terms.

If you are at this point in your financial situation, you need to consider options for debt management such as a debt settlement program offered through Provanta Corporation. See www.provantacorp.com. (see “Signs of Excessive Debt”).