Bad credit financing was always difficult, even in times when banks were throwing money around, at anybody who apply for a loan. With the credit squeeze begining to bite, financial institutions that used to service sub-prime borrowers, are no longer that keen on approving the loans. Banks are now carefully considering each application for a finance, affraid to lend to less than highly credit worthy individuals and businesses.

So, what the future holds, for those with poor or bad credit status?
Firstly, they need to get their finances in order, before thinking about borrowing. This means identifying immediate savings that they can demonstrate to the lender. This will not only improve their financial status, but will give the lender greater security. Yes, cash is the best form of convincing a conservative banker, that you are worthy consideration for a loan.

Majority of financial institutions - banks, savings and loans and credit unions offer their customers "courtesy overdraft-protection" and "bounce coverage" plans. This should be of a major interest to all consumers who value their credit score.
The idea is that your checks do not bounce, or your debit card, or ATM transactions go through, despite your account having no funds, or insufficient funds.
When you enroll in one of these plans, you will avoid the merchant’s returned-check fee and will stay in good credit standing with the people you transact in your business with. More importantly, you won't be reported to credit bureaus.
However, you still will have to pay an overdraft fee or a bounce coverage fee to the bank for each check or transaction that have not been covered by the deposited funds.

What's the cost of these courtesy overdraft-protection, or bounce coverage, plans to you, the customer?

Do you belong to the growing number of folks who are falling way behind in their payments and are uncertain as to what this is going to do to your credit score? Times are tough, and in the short term they are only going to get much tougher. But there are always things that can be done, even when the situation appears to be hopeless.

One of the first very important things that you must do is to keep your financial institution informed if you are having difficulties. Hoping that everything will be alright tomorrow is not going to work in this case. You may or may not realise that most lenders will give you a grace period of around 30 days, but after this your credit score will be negatively affected.