Since joining this remarkable industry 5 years ago, I've always been a proponent for Credit Education.  I've met with many clients face-to-face to discuss the homebuying process and review their credit.  It's always a pleasant experience for me because I instill wisdom in them that they would not have had.

Every one of my meeting includes an "Aha!" moment.  Sometimes this "Aha!" can be substituted with a stiff slap onto one's own forehead, or maybe a "Doh!", instead.  That's the moment that the potential homeowner says to themselves, "Man!  If I had only known that sooner, I wouldn't be in this situation!"

The problem could be just that.  They don't know about credit until it's too late.  My thoughts are old, but this post was inspired by the conversation from this post about adding credit education to the high school curriculum.

There are schools that attempt to include Credit Education into their curriculum.  However, the teachers themselves are the same people we real estate professionals see everyday.  They mostly don't have a clue.  Teachers are trained to teach what they don't know (if they have to), so that shouldn't be a problem.  They do this by relying on text books. 

Credit Education in a text book?  The rules change so often that writing them down is almost a pointless excercise.  I've read some texts about this subject that my local high school uses and I found error after error.  It could be even more damaging to teach incorrect and outdated information than to not teach it at all! 

Let's say we do teach the subject of Credit Education.  Our younger generations now have a leg-up on life.  What about circumstance?  Many of the people I've had the pleasure to council have had major life changes and distractions that have led to the problems with their credit. 

Divorces are nasty.  My latest tale is that an ex-wife, knowing that the account was also in his name, purposefully refused to pay the LAST payment on her car loan.  She sacrificed herself, wasting 4 years and 11 months of good payments, just to hurt her ex-hubby.  All the Credit Education in the world couldn't stop her from exacting her revenge.  Emotions are powerful.

Injury is another issue.  We've all seen large medical bills bring someone down.  On top of that, the injured may also lose wages from their job making it impossible to keep up with monthly bills.  This double whammy wreaks havoc on a credit score.  Could Credit Education help this person?

Credit Education certainly couldn't hurt someone.  It can only be a positive.  Education won't solve the problems of our country alone.  We can't stop necessity, anger, or ignorance.  However, education could be a way to help our next generations. 

There is a ripple effect to this idea.  We can educate our children about credit.  They'll be more likely to use credit wisely.  Creditors will have less defaults.  This will create better interest rates and financing terms for everyone. 

Look at the problem we have in the market today.  We've got tons of inventory on the market, but no qualified buyers to buy them.  Banks have tightened their guidelines making it more difficult to get a loan.  Really, what's happening is that banks are re-learning how to lend appropriately, to assure repayment.  With our future generations, we have to create borrowers that are worth lending to.