Losing your job and drawing unemployment benefit need not necessarily affect your credit score. While not in employment, to have some income is a great blessing. You can meet your expenses with that income. A wise person will reduce his expenditure to a minimum and pay up the debts on time with the available resources. Such an approach will keep the credit score high.

The loss of job may marginally affect the credit score because your income is reduced. You can overcome the difficulties by wisely handling the situation. Try for a new job. Until you get a new job keep your expenses as low as possible. The recession will not last for ever. Pay your bills on time. If the unemployment lasts longer and you find yourself not able to pay up debts on time, in spite of your best efforts, contact the lender. This must be done before you default on any payment due. Do not wait for the lender to contact the credit agencies and report you as a defaulter. Such an action on your part will increase the confidence of the lender in you and your intention to clear the debts even when you are in a difficult situation.

If you contact the creditors they will be only too glad to reschedule the repayment. A good track record while you were employed will also help a lot. What the creditors want is their money back, not you declared a delinquent. It is also wise not to apply for a new credit card while you are unemployed. Since you have no income to show for an additional credit card the request may be turned down. Such a rejection will adversely affect your credit score. During a lay-off keep a low profile on the expenditure front and try to pay back the debts at the best of your ability.