The concept of credit is not alien to most people as they are fully aware of what good credit means. People can survive with bad credit, but it is never easy, and it is really expensive. Most people do not know the implications of good credit, how much it helps them, and its opportunity. Credit has evolved from a representation of financial worthiness and has become criteria for worthiness, trust, and credibility. This evolution has affected the way several institutions work and how they affect the lives of people. As a result, this article discusses 6 ways your credit score can help you win in life. Some of those ways are:
The Low-Interest Rate On Loans And Credit Cards: Interest is the extra amount you pay for borrowing money aside from the amount borrowed. The interest rate is the percentage that dictates the extra amount to be paid asides from the principal. A lower interest rate means that you are going to pay less, which undoubtedly makes the life of anyone easier. This means that you get to pay back the loan more easily while executing your project, fund your business, and pay for your mortgage. However, the interest rate is often decided by your creditworthiness which is influenced by your credit score. A great credit score helps you qualify for the best interest rates, which ultimately offers you lower charges on your credit cards and loans. Ultimately, it will be easier for you to repay the loan, save up money to grow, and expand your business while you enjoy and relish everything life offers with your funds.
Higher Negotiating Power And Approval for loans and credit cards: Every credit or financial institution wants to deal with credible customers or clients. A good credit score is a sign of creditworthiness and shows that an individual is financially credible and likely to return the money in good time. On the other hand, borrowers with low credit scores are unlikely to be granted approval for loans because their credit scores depict credit unworthiness. This bad credit score implies that they are unlikely to repay the loan in good time. Hence, a good credit score increases your chances of getting a loan or a credit card.
Aside from all these, a good score also gives you leverage and the opportunity to negotiate a lower interest rate when you take up a new loan or a credit card. Besides a lower interest rate, countless offers can enhance your bargaining power which can be taken advantage of through a great credit score. On the contrary, a low credit score puts you in a difficult position while negotiating to make it difficult for creditors to agree to your offer.
Flexible, easy approval for rent and housing: Just like several institutions that gauge trustworthiness through a credit score, a landlord or a housing agency is not any different. Many landlords make use of the credit score as part of the criteria for screening tenants. Experience has shown that a bad credit score, particularly caused by an outstanding rental balance, often makes it hard for you to get an apartment. A good credit score proves that you are trustworthy and creditworthy and are likely to pay your house rent as and when due. Ultimately, a good credit score makes it easier for you to get an apartment without having to look for a landlord who won’t be concerned about your credit scores and would offer you an apartment.
Great car insurance rates: Car insurance agencies are among the long list of institutions that will make your life hard for you if you have a bad credit score. An insurance company makes use of information on the credit score to discover your insurance risk score. As a result of the insurance risk score generated, companies penalize individuals with low credit scores with high insurance rates. With a good credit score, you are likely to pay less for your car insurance than someone with a low credit score.
Free from Security Deposits on Utilities: The security deposit is a normal occurrence and can be a huge inconvenience when relocating. Sometimes they range from $100 to $200, which is often unpredictable and likely to change your plans. A good credit score prevents this from happening even when you relocate.
Contract with a cell phone company without a security deposit: It is impossible to secure a contract with a cell phone company with a bad credit score. A contract with a cell phone company gives you packages suited to your needs. Anyone with a bad credit score has no leverage and can’t get such contracts or discounts and will have to choose one of the pay-as-you-go plans with an expensive phone.
Developing a great credit score means that payment should be made as and when due. Hence, an invoice generator might help inform you about when to pay and the cost. Enterprise analytics is an excellent way to know your financial capabilities and plan accordingly to enhance your credit score if you are running a company or an organization.
Ultimately, if you want to lead a great and easier life, then a good credit score is an excellent way to get started and begin winning in life.