April 20, 2022 –Hispanic Solutions Group
Good credit can help you borrow money cheaper, qualify for credit cards, have lower insurance costs and more benefits.
The vast majority of users know that: Good credit is a good credit history that shows potential lenders that you have a history of repaying borrowed money as agreed. That can reassure them that you are likely to do so in the future and that you are a desirable customer. A strong credit history can also be important to prospective homeowners, employers and, in many states, insurers.
Here’s how good credit can benefit you
1. Borrow money at a better interest rate
Scores above 740 generally qualify for the lowest mortgage rates available. Higher credit scores can also lead to lower interest rates on auto loans. Lenders also look at things like your debt-to-income ratio, but in general, a good score and adequate disposable income rank you well.
You can aim for the highest credit score if you want, but it’s unlikely you’ll get anything more than a great score.
2. Qualify for the best credit card offers
A strong credit history will help you qualify for the best credit cards, which include low interest rates, rewards, and cash back.
In addition to helping you save money, these benefits will encourage you to keep using your credit card, which can help your credit if you continue to pay on time and keep balances low compared to your credit limits.
A low-interest or no-interest credit card can also serve as a temporary emergency fund if the need arises, or it can allow you to take advantage of a business opportunity.
3. Get favorable terms for a new cell phone
These days smartphones or cell phone upgrades can be expensive. But a good credit score can allow you to finance a phone on favorable terms that allow you to pay little or no interest.
For example, according to an offer available at the end of this year 2021, (which we are already experiencing) you could finance a new iPhone 13 with 0% interest, paying around $22 per month for 36 months, if you sign up for a service plan. Without good credit, you’ll likely have to pay the $800 phone cost up front or pay a higher interest rate if you qualify for financing.
The Data. –Stay up to date with your credit score
4. Improve your chances of renting a home
Like a potential lender, a landlord will want to verify your payment history by taking a look at your credit. This gives you an idea of how likely you are to pay your rent on time each month. If your history has too many negative marks, getting the apartment of your dreams can be difficult. Even if you can rent with bad credit, your landlord may charge a higher security deposit or require a co-signer on the lease.
5. Receive better auto and home insurance rates
To predict potential losses for customers, some auto insurance companies take credit-based scores into account when determining monthly premiums in states that allow this practice. You can’t be turned down entirely on the basis of credit, but you’ll likely pay higher premiums if your credit score is too low.
In most states, bad credit can also make homeowners and renters insurance more expensive.
6. Avoid utility deposits
Before hiring you as a customer, a utility company might look at your credit report to get an idea of your payment history. If your credit isn’t up to par, the utility company may require a deposit or request a letter of guarantee, in which a friend or family member agrees to pay your bill if you don’t.
7. Get a job
In some states, employers may request your credit report as part of your job application. You will know if they do; because your consent is required.
Because the effects of good credit can be felt in many parts of your life, it’s important to do what you can to help it. Paying your bills on time is a big part of the recipe, as is keeping credit card balances below 30% of your credit limits, and the lower the better.
If you have any questions related to finances, credits in the United States and other related issues, but do not know who to turn to, contact us by going to Hispanic Solutions Group, writing to email@example.com.
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