Why is my Credit Score Important?

Your credit score can be a blessing or a burden.  Fortunately, at Citizens' its neither since we don't have a minimum credit score requirement like other lenders. A credit score is a three digit number between 300 and 850.  850 is the best possible credit score you can obtain.  By having a good credit score, you can enjoy lower interest rates whenever you decide to borrow money.  From home loans to automobile loans, borrowing money can not only be an easier process if you have a quality credit score, but can create lower payments for you over the life of the loan.

Where your credit score comes into play
It is nearly impossible to go through life without the need of a loan.  When you look to purchase a home, buy a new car or even apply for a credit card, your credit score is taken into consideration from the lender.  Your credit score is a reflection on how likely you are to pay back the loan on time.  Below are just a few instances in which you may need to borrow money.

Credit cards
Most people have a credit card.  They allow you to make purchases while putting off payment at a later date.  This helps people budget their money and consolidates all expenditures.  When applying for a credit card, your interest rate is typically a direct reflection of your credit score.  Credit cards often carry a high interest rate (29% - 79% is not uncommon) for those that have less than perfect credit, with fees up to 25% of the credit limit.  On the other hand, the higher your credit score, the lower your interest rates. 

Home loans
A mortgage lender will typically provide very good interest rates for those with a credit score of 720 or higher.  Being a high risk borrower, or having a below average credit score, can lead to high interest rates and, unfortunately, not being able to borrow as much as you initially intended.

Renting
Often overlooked, many landlords will check a potential renter’s credit score before deciding to rent an apartment.  This is done with the renter’s consent.  Those with bad credit can also be required to a pay a deposit to utility companies.

About Citizens Savings & Loan
At Citizens, we help people achieve their financial dreams.  Many times it starts with establishing or re-establishing their credit score.  Our loan products range from bill consolidation loans to personal loans, all of which can help repair credit scores.  If you are interested in our loan products, or would like to learn more about how you can improve your credit score, contact us today.