5 Careless Credit Mistakes Millennials Make

By: Robert J. Nahoum

A man in suit and tie with his arms crossed.

In a recent survey 30% of millennials said they would sell a body part to pay off student debt.  The absurdity of this statement certainly highlights the tremendous attention given to the student debt crisis facing millennials.  Weighed down by hefty student debt, any hopes millennials have of ever buying a home, getting a car loan, getting insurance or even renting an apartment hinge on a decent credit score.  While a person’s credit score is just a seemingly amorphous measure of how good you are at paying back debt, too much is riding on it to make careless mistakes.

Here are five careless credit mistakes millennials should avoid:


Whether its credit cards, student loans, car loans or mortgage loans, one of the quickest ways to sink your credit score is by making late payments.  Forget for a moment the unruly late fees and penalties you’ll be hit with, if you go more than 30 days late on a credit payment the creditor will likely report you as delinquent. This will be a big hit to your credit score.  As your score gets lower, the cost of credit goes up.  Avoid all this unnecessary cost by being vigilant about making payments on time.


People often make the mistake of thinking that if they just send the bank something they won’t get reported – WRONG.  If you don’t make that minimum payment when it’s due, whatever is left over will be reported as delinquent.


A Federal Trade Commission study of the U.S. credit reporting industry concluded that 25% of consumers had errors on one of their three major credit reports.  With 322,583,006 people in America that means that more than 80 million Americans have errors on their reports.

Common errors found in credit reports include:

  • Outdated information (usually older than 7 years).
  • Accounts incorrectly reported as delinquent.
  • Information that is not yours because of confused names, addresses, etc.


  • Reported debts incurred as a result of identity theft.
  • Delinquent accounts reported by multiple creditors.
  • Information from an ex-spouse.

Mistakes on your credit report can lead to increased interest and insurance rates, rejected as rejected credit, employment and housing applications.  You should regularly monitor your credit report to ensure their accuracy.


Closing a credit account with a high credit limit could hurt your credit score if you have high balances on other cards or loans.  Your credit score is highly impacted by your ratio of available credit to debt.  If you close out a high credit limit account leaving high debt accounts, you tip the scales of that ratio in the wrong direction.


A default judgment is a court judgment awarded automatically to the Plaintiff (the party suing) without a trial.  Default judgments are awarded because the defendant (the party being sued) failed to timely appear and defend the lawsuit.

Default judgments lead to frozen bank accounts, bounced checks, overdrafts and garnisheed wages all of which could have a severely negative impact on your credit score.  Avoid these problems by taking the debt collectors and their lawyers seriously when they threaten to sue.

If you need help with a consumer protection issue, contact us today to see what we can do for you.

The Law Offices of Robert J. Nahoum, P.C
(845) 232-0202

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