Why Is Credit Is Important?

Your credit is more than just a three digit number. It will affect just about every financial decision that you make. There are several reasons that you will need to make sure that you have a good credit score.

Your Credit Score Can Affect Where You Live

Regardless of whether you want to rent or buy, your credit score can affect where you live. Both lenders and landlords want you to know that you will be able to make your payments on time. If you have a low credit score, then it can be a lot harder for you to get approved for a mortgage. A good credit score will not only make it easier for you to get approved for a mortgage, but you can also make a lower down payment.

It is possible for you to get an apartment with a low credit score, but landlords will likely require that you make a higher deposit. A good credit score can help you save money because you will likely be able to make a smaller deposit.

Help You Pay for College

If you want to continue your education or plan on sending your children to college, then you will need to have a good credit score. Most people will need to take out a loan in order to pay for their education. A good credit score will help you get a student loan with better interest rates.

Get a Loan

Most people will need to get a loan to buy a car or cover their living expenses at some point. Every lender has their own requirements for getting an auto loan. However, the better your credit is, the easier it will be for you to get a loan. You will also be able to pay less in interest.

Get a Credit Card

When credit cards are used responsibly, they can help you build your credit. However, your current credit score will affect whether you get approved for a credit card. You will also be able to get a credit card with a lower interest rate.

Employment

Some employers will check your credit before they decide to hire you. This is a controversial practice, but you can get denied a job if your credit score is low. Employers are looking for people who are financially responsible. If they see negative items on your credit report, then they may assume that you do not handle your money well.