Disclaimer: The following is a sponsored post by Lexington Law. All opinions are 100% my own.
A credit score is a 3-digit number that represents the creditworthiness of an individual based on information on your unique credit report.
Did you know that your number can impact your future in several ways?
From getting a loan for a car, house, or student loan, your credit score truly matters.
And with over 43% of Americans having a credit score under 699, there is a ton of room for improvement.
Here are 7 ways your credit score can impact your future. #7 may really surprise you!
#1 Saving money
Saving money can be tremendously harder when you have a low credit score.
This is due to individuals with low credit scores being hit with much higher interest rates on loans or credit cards.
“For those with bad credit, increased interest rates may further inflate their cost of living, making even small purchases seem difficult. A bad credit report can cost you thousands of dollars a year in overpaid interest or can keep you from being approved for credit altogether. Use the chart below to see how bad credit scores may impact you.”
If your credit score has taken a hit and you aren't sure why I recommend getting assistance from professionals who will act on your behalf for your personalized needs.
The Lexington Law team can give you a free credit report review and recommended personalized solutions that best fit your needs.
#2 Buying the house you want
The home-buying process can be very tedious and time-consuming.
Unfortunately, a low credit can make buying a home even more stressful because you could end up spending much more money than if you had a good credit score.
And if you're a numbers person, viewing this graph below will quickly show you what a good credit score and a bad credit score can do.
|$250,000 home paid over 30 years:|
|CREDIT STATUS||RATE||PAYMENT||COST OF BAD CREDIT|
Over 30 years on a $250,000 home, someone with a bad credit score could expect to pay $132,574 more just because of their bad credit.
#3 Getting a car loan
The majority of people need a loan in order to purchase a car.
With a high credit score, a bank or car dealer is likely to give zero-interest for the car, while someone with a poor credit score will have a much higher rate, potentially paying thousands more for the same car.
And if you're credit score is too low, you could potentially even be denied a car loan altogether.
With a low credit score, a much bigger down payment will be necessary as well, along with other costs, including car insurance.
Insurance companies associate low credit scores with more claims filed, which is why they may charge more for the premium.
#4 Using credit cards
When someone with a low credit score applies for a credit card, they may be denied due to their credit history.
This is because credit card companies see this as the person not being responsible with money or being able to pay back their credit card debt.
Even worse, with bad credit, your options for higher quality credit cards are limited. People with lower credit do not have very many options or credit cards.
#5 Affects interest rates
If you have a low credit score, this indicates to creditors that you may be a riskier borrower, and they are likely to charge you a much higher interest rate due to the risk they have to take.
This means you will pay much more for a car, house, or business loan if you're accepted at all.
If your credit score is much lower than you'd like it to be, I encourage you to reach out to the team at Lexington Law who understand consumer protection laws and can help you make sure your credit report is fair, accurate, and substantiated.
Are you ready to get started increasing your credit score? Contact Lexington Law here to get your free credit report summary and credit repair consultation.
#6 Your career
A bad credit report can ruin your job search due to many companies checking the credit of applicants.
Though there are several states that don't allow credit checks, the majority of the United States does allow it.
Jobs specifically in the finance industry are more likely to ask for applicant's credit report.
This is because these careers check to see someone's responsibility with money and may connect it to how well they will perform at the job.
#7 Impacts relationships
A low credit score can impact a relationship in ways that may seem surprising.
Buying a house, car, or renting from a landlord can result in rejection if one spouse has a poor credit history and credit score.
Although credit scores from a husband and wife do not merge, being joint account holders can affect each other's credit.
“For example, if a husband and wife are joint account holders on a credit card and the husband is 30 days late paying the bill one month, a 30-day late negative item will most likely appear on the credit reports of both the husband and the wife. When two spouses apply jointly for credit, such as for a mortgage, the lender will consider both applicants’ credit histories when making the decision of whether to extend credit. One spouse’s poor credit history could result in denial of the loan or approval with a higher interest rate.”
This is why it's important for both people in a relationship to have a good credit score.
If your credit score is at a place that you do not like, I recommend seeking assistance from Lexington Law, who have assisted thousands of clients with the removal of inaccurate and unverifiable items from credit reports such as late payments, collections, charge-offs, and various other items.
If you need assistance with filing disputes or challenging specific items on your credit report, learn more about Lexington Law here and start getting the help you need today.
Did you know your credit score impacts your future?
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