FORT LAUDERDALE, FL--(Marketwire - Oct 2, 2012) - Having debt can negatively impact consumers' finances, but not carrying any debt can also be a bad scenario for some people. For Hispanics the absence of debt translates into poor credit histories and denied loan applications.
Only 56 percent of Hispanics in the US have credit cards, compared to 80 percent of the general population in America, according to the National Council of la Raza. Even though 17.1 percent of Hispanics carry some debt with the purpose of building their credit history, there is still a high percentage that only uses cash for purchases.
"The lack of credit cards has prevented many Hispanics from drowning in debt, but it's part of the reason many Latinos haven't built a solid credit history," said Howard Dvorkin, CPA and founder of ConsolidatedCredit.org.
Dvorkin said some Hispanics lack strong credit histories due to the barriers they face when attempting to obtain credit cards.
- Lack of required documentation - Even if Hispanics are legal residents, they may not have all of the documentation required to obtain a credit card. For instance, new immigrants may not have a social security or driver's license. It's essential that immigrants focus their attention on getting these documents, as they are crucial to establish credit.
- Fear of the unknown - The rules for obtaining credit is different in the US than in other countries. In other countries credit is not as important as in the United States, and interest rates are completely different. Many times the fear of the unknown stops Hispanics from getting their first credit card. In order to overcome this fear, Hispanics can learn about interest rates, credit scores and debt management in the learning section of ConsolidatedCredit.org before getting a credit card. These resources are free and can make a big difference regarding Hispanics' finances.
- Lack of trust- Highly publicized stories about fraud in the credit industry have made Hispanics skeptical of credit service agencies. Hispanic individuals simply don't know how to choose a credit service that will treat them with honesty, dignity and respect. Hispanics who need credit help can visit the Better Business Bureau to check out the reputation of financial companies.
- Language barriers - There are many organizations and websites that offer credit card information in English, but only a few resources are available in Spanish. A survey conducted by the Tomás Rivera Policy Institute found that Hispanics do not seek out the services of credit counseling services, in part, due to a lack of information in Spanish. For credit card information in Spanish, Hispanics can visit Espanol.ConsolidatedCredit.org or The Federal Trade Commission for information on consumer rights.
Visit http://espanol.consolidatedcredit.org or http://www.facebook.com/ConsolidarCredito or simply call (800) 560-6213 for more information about how to overcome barriers to obtaining credit and building a good credit history.
About Consolidated Credit:
Consolidated Credit Counseling Services, Inc., founded in 1993, is one of the nation's largest credit counseling organizations in the country and has helped over 5 million people with financial issues. Their mission is to assist families throughout the United States in ending financial crisis and solving money management problems through education and professional counseling.