You've seen the ads for mortgage companies and car dealerships that say that everyone is approved. These ads are targeted at those with a less-than-perfect credit score or even a bankruptcy in recent years.

There are plenty of people out there that need a fresh start when it comes to credit. Many make mistakes. Many simply don't understand how credit works. And often, there are illnesses, job losses and accidents that ruin a person's credit.

But when a lender specifically points out that everyone is approved or that bad credit is okay, you are looking at the potential of falling prey to a predatory lender.

That lender is wanting you to pay an unreasonably high interest rate and sign for unfavorable terms. Yes, it is reasonable to assume that the lower your credit score, the more you will pay. However, there is a point where interest rates become bad business.

When you are already struggling to pay your debts, you don't want to take on a loan that has a sky-high interest rate, large late payment fees and pre-payment penalties. While your bad credit is okay for the lender, his terms may not be good for you.

If you have bad credit, then you are just going to have to take responsibility for it. This doesn't mean that you can run out and get a loan just because bad credit is okay with a lender. That is simply assuming that you can afford that car or house, when you really can't afford it.

The thing you must always remember is that no lender can tell you how much you can afford to borrow. The lender isn't looking at your personal spending habits. The lender really doesn't care about how much you need to spend on groceries or medication. The lender is simply trying to make a loan. And some lenders actually want you to fall behind or default -- that way, they end up with more in late payments and a default interest rate.

What it all comes down to is that if you are in a situation where you are looking for a lender that says your bad credit is okay, perhaps you should be looking at your budget and your credit situation first. Once you are on the right track, look for a lender who will appreciate the change in your spending and credit management.