I do so worry about money and the younger generations. Credit seems so easy these days
Did you know….
- 2 million 18-34 year olds have skipped a bill payment
- 31% of young people have been rejected for either a mortgage, store card, personal loan, mobile phone contract or car finance
- 62% of the UK feel more should be done to explain the impact of a missed bill
- The average unpaid bill is just £7.60, which is enough to have a mortgage application rejected
Some pretty shocking new research has revealed that 1.2 million Millennials (18-34) have ignored a payment in the last month.
And as a result nearly a third (31%) of this age group has been rejected for a financial product such as a mortgage or store card. This rejection will be because they have defaulted on a repayment.
The average outstanding amount is actually really tiny – less than £8 (£7.60). They dont seem to reslise defaulting on any payment – big or small – can cause difficulties in the future because of the negative impact it has on someone’s credit score.
Despite loving their phones it turns out phone contracts are the most readily ignored bills. 16% of young people admit to ignoring the last payment of a contract, this figure is three times higher than the proportion of older people who admitted they had done this.
It seems lack of education is responsible. Lack of knowledge could be the route of the issue: 62% of the UK population don’t feel informed about the repercussions of missing a payment and this number rises to 70% amongst the Millennial generation.
CEO and founder Justin Basini comments, “Missing a minor payment may seem harmless at the time, but it can come back to haunt you.
The consequences of defaulting on a payment – even it’s just a small amount – can be huge. A lender will take into account the information in your credit report before giving you a mortgage or a credit card. This isn’t just about how much you owe or earn, but more importantly how you have managed your credit in the past.
Unless it’s a bank or credit card firm, organisations aren’t legally required to let you know you’re about to default on a payment. The onus is therefore on us to keep track of what we owe to whom. If you’re not sure whether there could be an unpaid bill lingering, arm yourself against the disproportionate punishment of being rejected for credit by checking your credit report online for free.”
IIts really useful to know your credit score.
ClearScore enables users to find their credit scores for free. Check out their website to find out how to do this as well as tips on how to improve it.