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The Importance of Your Credit Score

Many consumers don’t quite understand the importance of a credit score. Credit scores and reports are used by more businesses today than at any other time since the credit score system was first invented by FICO in 1989. Today, the following are just a few of the types of companies that use your credit score to make a decision:

  • Credit Card Companies
  • Employment Agencies
  • HR Departments
  • Personal Loan Lenders
  • Home Loan Lenders
  • Auto Loan Lenders
  • Banks
  • Auto Insurance Companies
  • Rental Management Companies
  • Apartment Complexes
  • And more

Why is this so important?

Your credit score can be the difference between being able to afford the new car you want or having to settle for a used car with no warranty because your interest rate is too high to afford anything else. It can be the difference between getting an apartment in a decent neighborhood or getting one in a bad neighborhood because you can’t afford the security deposit anywhere else. It can even be the difference between getting your dream job or working at the neighborhood grocery store because they don’t check your credit score for employment.

You may think that your credit score isn’t important, but it’s use as a determination factor with companies is increasing at a rate that will make it significantly important in the near future. Keeping your score at “Good” or better should be a high priority.  It not only allows you to have the flexibility to afford nicer things, but also allows you alternative options in emergency situations. For example, if you have a good credit score and your car breaks down you would have the options of financing the repairs at the shop, using your credit card, getting a personal loan, etc. You can get back on the road in a matter of days! But if you have a bad credit score your only option is cash on hand and in your savings back. For a lucky few you may have a secured credit card with a high enough balance available to allow you to charge the repairs, but many of you won’t get financing to cover the repairs.

Credit scores are very important. It’s in your best interest to monitor it monthly. There are many great ways to do so, and some of them, like Credit Karma and Discover Credit Score Card, are excellent FREE ways to keep up on your score!

Posted by: ashokalion on October 23, 2017
Posted in: Uncategorized