Millenials Faced Unprecedented Rejection In 2020

Christina Rodgers
Millenials Faced Unprecedented Rejection In 2020
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2020 was one heck of a year, and for millennials, it was a significant financial setback.

According to a national survey, a whopping 32 percent of millennials have been denied credit this year - compared with 22 percent for Gen-Xers and 11 percent for Baby Boomers.

What’s making matters worse, lenders are not easing up on their underwriting standards.

One main reason for the increased scrutiny for obtaining credit is the ongoing pandemic. In the second quarter, of 2020, the federal reserve found that more than 7 in ten credit card issuers had tightened their lending standards. Not one had eased them.

Many consumers need to look for ways to maintain or even boost their FICO Scores.

Experian Boost™, from Experian™, will allow customers to register specific bills to report positive payment history. You can even report payments to streaming services to improve their credit situation.

However, there is a significant divide taking place in America that is not going unnoticed. Food lines are growing, and millions are out of work. All while the average credit score is going up during the pandemic.

The issue is, if you fall behind now, getting back on track will be more challenging than ever.

Like Experian Boost™, there are other products you can register for that can bolster your FICO® Score and keep your future credit prospects on the right track.

Credit builder loans like Self, are an option. Self allows you to open a loan you “self” fund. By opening a loan at an FDIC insured bank, you can report the payments to boost your FICO® Score. Since your paying the loan back to yourself, you didn’t need to go through any credit checks. Your FICO® isn’t lowered, and no inquiry against your credit profile is required. You can choose the monthly amount you want to pay as well. The loan essentially becomes your own savings account.

You can always become an authorized user on someone else’s credit card. What’s this? Your name can be added to the credit card of someone you trust - and someone that trusts you. This usually a parent or spouse. This is an easy, no-cost way to start building up your credit score with the helped of a loved one.

But there are pitfalls. If the primary card user misses a payment, it negatively affects your history.

The gold standard in boosting your credit score, in our opinion, are secured credit cards. There are no credit checks to open a secured card account. You essentially are placing a deposit at an issuing bank, and that deposit is held as security for your “line of credit”.

Unlike being added as an authorized user on someone else’s card, your positive payment history depends on you alone. A secured credit card gives you double the impact if you pay on time and keep your balance low. The only con we see if that your cash deposit is tied up. But remember it does earn interest, which is payable to you when you close the account.