Do you have a good credit score can save you thousands of dollars?
credit scores (or Fair Isaac Credit Score) follow you from job to job and are not only not determine the interest rate you pay on your car or a mortgage.
your credit score can also help if you are promoted in your work and what kind of rate you pay on your car insurance.
If you have too much debt, you might not get that new dream job. Tweet this
Even utility companies check the scores and decide if you need to pay a deposit based on the score.
Responsibility credit card Disclosure Act (widely known as the Credit Card Act) liability and makes understanding easier credit, but it is also affected on credit scores to consumers.
lenders have reduced credit limits, canceled cards and raised the annual rate APRs to counter the bill. Because of these strategies and the consequences of the recession, millions of Americans FICO scores are down.
According to recent figures provided by FICO, 25.5% of consumers (nearly 43.4 million) now have a credit score of 599 or below, marking them as poor risks for lenders.
makes it unlikely that this group will get credit cards, auto loans or mortgages under the tighter lending standards banks now use.
These credit ratings can also make the difference between whether you are accepted or rejected for a consolidation loan, as a tenant and more. This is one of many reasons why it is important to know your number
Summary:.? Why do I need a good credit score
A good credit score is invaluable for everyone. The benefits of a good score in one word:
security clearance - If you are having financial problems, as indicated by a FICO score, then you are a security risk can not be . allowed to work in areas requiring a security clearance, such as military or civilian contractors
loans -. a good credit score helps you get ready and get faster loan approval
Interest rates - Your FICO score is often the determining factor when it comes time to be awarded an interest rate
a higher rating can help you get a better mortgage rate and might. even mean the difference between owning versus a tenant continues
0% APR -. Have you ever been tempted by advertising on a new car, furniture or a new credit card that offers a special "0% APR"?
Few people realize that these types of offers Special not go to those in the upper levels of FICO scores.
If a good credit score holder acquires too many of these types of loans, they will deteriorate their score. So book them for loans long term, as a new car
so close and yet so far . - Sometimes the difference between qualifying and not qualifying for much may be as close as 20 points your FICO score
:. You can say "So what? I am not eligible for it, but I can still enjoy a relatively low interest rates. "But he adds, and matters a lot. The difference on a loan of $ 20,000 car at a 0% APR against 7% to 8% APR is about $ 1,800 over the loan
job applications -. Your score can have an impact if you get a job that requires high security clearance, such as the positions of the government and the financial sector
location - .. Some people can not rent a house or apartment without a good credit score
Utilities -. you can often have your lifting deposit if you have a good FICO
Insurance Rates - It can affect your insurance premiums. Some auto insurers use credit information to help determine insurance rates.
In fact, 92 of the 100 largest personal automobile insurance companies in the country use credit data in the new business underwriting, according to a study by Conning & Co.
Three easy steps to improve your credit score
Step 1: Pay your credit bills a day early than a day late
Configure pay Automatic bill online, so you'll never be late. It is not that you are paying as much as soon as you never pay late
Step 2 :. Pay attention to the proportionality
Keep your costs to 50% or less of available credit, even if you pay the card at the end of each month. This means that if you have a credit limit of $ 5000, you should never have a balance of more than $ 2,500
Step 3 :. Pay at least $ 5 more than the minimum each month
Paying extra on your report shows that pay your debt makes up your credit score!
Not only that, but you can pay above the minimum payment, the less you pay in interest charges.
As I've mentioned in previous blogs, our family had $ 40,000 of consumer debt and very low FICO scores at one point. After work, we improved our FICO to the point where we qualified for a 0% APR on a new car loan offer.
Our young adults create good scores as well. In fact, our 22 year old son was a 700+ score when he graduated from college, enough to pre-qualify for a mortgage home loan.
If we can do it, so can you!
When is the last time you checked your FICO score
photo credit: Kris Krug via photopin cc
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