| What are Increased Out-of-Pocket Costs? Basically, you can still borrow or use credit, but it costs more than it did compared to what it cost before the injury, because creditworthiness is changed, not because rates changed. This is not just a change of interest rates, but are you able to get credit at the same qualification rate as before injury? For vehicular or real estate purchase or lease, a higher down payment or increased rates are the two examples of increased out-of-pocket. For example: If your credit card interest rate was 10% before the injury but the company has notified you that the rate will go up - maybe as high as 24% due to credit erosion, or negative remarks appearing in your credit report this would increase your out-of-pocket costs. If you are unable to purchase or refinance when you would have been able to do so except for the damage, then increased out-of-pocket costs would result. When the damage is mitigated, or if you accept the higher out-of-pocket costs, you may be entitled to compensation for having had to pay more than your pre-injury creditworthiness would have been charged. If your state allows use of credit reports for insurance purposes, and your insurance is cancelled or rates are increased - that is a form of increased out-of-pocket costs. Any or all of these may be considered when measuring credit damage. If your credit interest rate changes because of general increase, that is definitely NOT credit damage. |