Why is My Credit Score Important?
Your credit score can be a blessing or a burden. A credit score is a three digit number between 300 and 850 (base FICO score). 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.
Most people have a credit card. They allow you to make purchases while putting off payment until 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% or higher 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
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
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 applicants with a higher credit score often have an advantage over applicants with a lower score.
If you would like to learn more about the process of obtaining a personal loan from Citizens, or if you would like to learn more about other types of loans we provide, we encourage you to contact us today or stop by any of our convenient locations. You can also get the process of applying for a loan started now, simply fill out our online application form and a friendly Citizens representative will contact you!