My, how things have changed! Back when I was in college, I got my first credit card — before I even had a job! Now, though, younger folks are being refused credit on a regular basis, thanks to the tighter lending standards in effect since the global financial crisis. Indeed, lenders are actually looking at credit histories and ability to repay, and that means that younger people are more likely to be rejected for loans, from mortgages to auto loans to credit cards.
Here is what I received from FindLaw.com on the matter:
The FindLaw.com survey found that more than one in five (22%) people
between the ages of 18 and 34 say that they have been refused a
mortgage, loan or credit card within the last year. That’s more than
twice the percentage of any other age group, and they are four times
more likely to say they’ve been turned down than people age 55 and up.
And, of course, the implementation of the Credit CARD Act is likely to make this trend even more pronounced — especially in terms of credit cards. People under 21 now have to have co-signers for their credit cards unless they can prove their ability to repay.
According to the survey, young people have even been turned down for student loans. With financial aid growing scarcer in this economy, it may be difficult for students to finance an education. And the old standby, student loans, may not even come through.
This survey highlights the importance of building a good credit history when possible. This means being responsible with the credit you do have, making on time payments and doing your best to pay off balances in full each month. Additionally, it is a good idea to check you credit report for errors, and get those fixed. The younger you are, the more important it is for you to prove that you can handle credit.